The Bureau of Labor Statistics released the Employment Situation Summary for February this morning, which showed a loss of 36,000 jobs in the Establishment Survey and an increase of over 300,000 jobs in the Household Survey. The Household Survey showed the U-3 unemployment rate coming in at 9.7% and the more comprehensive U-6 unemployment rate coming in at 16.8% for the month. A more complete breakdown of the report will follow:
I want to stress that the Household Survey showed an increase of 300,000+ jobs this month and that Survey can lead the Establishment Survey (as the Establishment Survey has a large firm bias) by a few months (on both sides of a recession). Essentially, one of these surveys will regress to the mean (either the Household will stop showing growth, or the Establishment will start), likely as early as next month.
Update: I will add the birth death info as soon as it is out. Well, it is now over an hour since the report and no birth/death update. I have to go to a meeting, so I will update (hopefully) after).
A couple more important numbers to watch out of the Household survey include the labor force participation rate which was at 64.8% for the month, an increase of .1% from January and the employment-population ratio which was 58.5 for February and showed an improvement .1 since January. Also, those not in the labor force decreased by 200,000 since January (a good thing).
The seasonal adjustment for February is very large and came in at 1.13% this year, which compares to a 5-year average of 1.15% and last year's adjustment of 1.46%. This means that the BLS has changed their underlying assumptions and that the seasonal adjustments are again likely to be smaller (at least on the positive side) for some time to come. Also, the much maligned birth/death adjustment came in at +97,000 for February, which compares to a 5-year average of +116,000. My analysis of both seasonal adjustments and the birth/death adjustment can be found at Bonddad's Blog if you are interested in a more statistical interpretation.
Overall the Establishment Survey saw strength in virtually no industries industries and weakness in construction and was another report showing a lack of a strong jobs recovery. However, the Household Survey showed large job creation for the second month in a row and may have turned corner, which should bleed over into the Establishment Survey soon. We shall see.
So, what does this mean for the likelihood of a double-dip recession in the near future (late this year/early 2011)? The longer the economy continues to lag in job creation plus the potential (and now probability) that extended unemployment benefits are going to be allowed to expire implies that there is increasing risk of falling back into recession as those losing benefits will be forced to cut even more spending, which will also hurt local/state governments even more. If state/local governments accelerate their layoffs and consumer demand begins to fall again, we may very well be headed towards a double-dip. And all of this says nothing about oil prices, which are again at $80/barrel, which could cause a double-dip all on their own, especially when gasoline prices start their annual increase with the switch to summer formulations that will begin soon.
Please recommend to get a jobs discussion up on the rec list if possible.