It appears that Biden's apparatchiks refuse to give up on the myth of a "strong labor market" just yet even as they admit to anyone who reads between the lines just how ugly things are getting.
Moments ago the BLS reported that in June the US added 206K jobs, above the 190K expected.
Not bad, especially with Goldman expecting 140K. Of course, a quick glance reveals where the "beat" came from: both previous months were revised sharply lower:
With these revisions, employment in April and May combined is 111,000 lower than previously reported. So yes, it is easy to "beat" when you have a pool of 111K jobs that never existed to push into this month. And course, next month when the June data is revised lower, the 206K beat will be revised to a sub 190K miss but by then it will be too late. And as shown in the chart below, 4 of the past 5 months have seen payrolls revised lower.
Not only that but the composition of jobs was once again dismal and followed the same gimmick the BLS used for its "strong" JOLTS report this week: private sector workers came in at 136K, well below the 160K expected and down from a downward revised 193K (was 229K). The gap was filled by - what else- deep stater and other government workers, as government payrolls jumped from 25K to 70K!
The good news is that unlike last month when the number of employed workers actually plunged again leading to a a record gap between the Establishment and Household Surveys, in June at least the number of employed workers rose by 116K. Which however means that the gap between the two series rose by another 90K!
Turning to the unemployment rate, there was a big surprise here because contrary to expectations of a flat print, the number rose to 4.1%, up from 4.0% in May and the highest print since November 2021!
Among the major worker groups, the unemployment rates for adult women (3.7 percent) and Asians (4.1 percent) increased in June. The jobless rates for adult men (3.8 percent), teenagers (12.1 percent), Whites (3.5 percent), Blacks (6.3 percent), and Hispanics (4.9 percent) showed little or no change over the month.
Some more stats from the latest jobs report:
Turning to hourly earnings, here too there was continued slowing with the average hourly earnings number rising 3.9% YoY, down from 4.1% in May and in line with expectations. On a monthly basis, the print also slower to 0.3%, down from 0.4% in May.
In keeping with the BLS' other favorite gimmick of representing part-time jobs growth as the primary driver of the US labor market, in June, the number of part-time workers rose 50K to 28.1 million while full-time workers dropped by 28K. This means that since June 2023, the US has added 1.8 million part-time jobs and lost 1.6 million ful-time jobs.
Finally, looking at the various industries, we find that the bulk of jobs growth in June was on the back of government workers, which as is well-known, do not actually produce anything but are a drain of US wealth and merely serve to redistribute income. Here is the full breakdown:
Commenting on the jobs report, Rubeela Farooqi, chief US economist at High Frequency Economics said that “Overall, a moderation in payrolls in Q2 coupled with a rise in the unemployment rate and a slower growth path suggested by recent data bolster the case for rate cuts this year. We think the Fed could certainly start the discussion about cutting rates at the upcoming FOMC meeting, and lower the policy rate in September, if the data continue to show moderation.”
And here is Seema Shah, chief global strategist at Principal Asset Management:“The equity market may be a little conflicted how to respond to today’s jobs report. On one hand, the downward revisions to prior months and the rise in the unemployment rate raises the odds of a September Fed rate cut – bond markets are certainly celebrating this. But those same figures cannot help but prompt a twinge of concern about the direction of the US economy. The broad host of economic data all point to a softening – today’s report adds to that picture.”
However, the bigger take home message here besides the timing of the next Fed cut which will come - just a matter of when - is that the Biden BLS is now clearly expecting to dump the mother of all disastrous job report realities on the Trump admin, which will come in just in time to have to revise the actual number of jobs lower by several million.
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