Blue World Employment Situation Report Analysis
Release Date: Usually the first Friday of each month
Release Site: www.bls.gov
Market Impact: VERY HIGH
Management Value: CRITICAL
Friday, September 04, 2015
Brain surgery is not rocket science to a brain surgeon©
The Truth Is Out There…
How can Blue World be in disagreement with so many “experts” when it comes to analyzing these things? Perhaps we should explain. How one interprets these reports depends on the angle from which one views them. An economist looks at it from one point of view, the reporting media is bias-dependent, politicians grab on to what can be spun whichever way they want it perceived…and then there’s us. We’re the small and mid-sized business owners and managers who are trying to make strategic decisions on our real-life businesses that earn and spend real money by employing real people. An academic review is not helpful and any kind of spin can lead us to errant conclusions. No, we need to see it for what it actually is so that we can convert the data into actionable intelligence. That’s why we’ve begun to publish our internal Blue World Economic Index™. It allows a view of the economy through over fifty monthly reports that smaller firms just don’t have the time to follow day in and day out but who need the information just the same.
This employment report? Predictably weak. There is some legitimate good news. College football is back! There is also some in the employment report and it can be found in the wages data. Year to date and twelve month runs show wages up 1% to 2%. And that’s the end of it.
There is trumpeting of the upward revisions to June and July, but it is misleading. Of the 44k in upward revisions only 5k are from the private sector. The headline is telling us the economy netted 173k new hires in August 2015, but of that only 140k came from the private sector. The participation rate now boasts three straight months of the “recovery” record low of 62.6 and the number of those Not in the Labor Force has set a new record by exploding over 261k, breaking above 94 million for the first time. Remember, these people are not counted as unemployed, and their graph has been on an uninterrupted climb since July 2011. That’s the graph this month and that’s why the 5.1 unemployment rate continues to be, uh, fictional. The diffusion rate in manufacturing cratered 9.3 points to a fully contractionary 41.3.
Matt will be on CBS radio WBBM in Chicago AM780 and 105.9FM for the Noon Business Hour today at 12:10p C to talk about all this and the podcast will be posted later this evening. Have a great month!
Thanks for reading and, please, stay tuned…