While the report was better than what could have been, some economists raised the issue of"seasonality". July is a tough month for calculating seasonal factor because teachers are off for the summer break and auto workers stay home as plants stay idle. Even ignoring this issue, the report was not great.
 Private payroll peaked in January 2008 at 138 million and troughed in February 2010 at 129 million. The latest release showed 133 million workers suggesting 130K a month job growth since the bottom. At this growth rate, job level will not reach January 2008 peak until early 2015. |
 We calculate monthly job growth required to get unemployment rate back to 6% by January 2015 on different population growth and participation rate assumptions. The bottom-line is that 160K is the minimum required. |
 From January 2008 to February 2010, 8.7 million jobs were lost. Since February 2010, 4 million jobs have been re-gained, meaning there are still 4.7 million jobs missing. Those 4.7 million jobs still missing are in manufacturing, construction and retail trade. Other interesting facts from the report, (1) since February 2010, 230K teachers have lost their jobs (2) manufacturing renaissance is a myth. Only 500K jobs have been re-gained since February 2010, while job loss between January 2008 and February 2010 was 2.2 million, meaning a net loss of 1.7 million jobs since the recession. |
