Wednesday, August 12, 2015

U.S. jobs still bouncing upward

Just wanted to drop this, as I've been busy with other topics and wanted to get to it. A new jobs report came out last Friday, and it showed that there was decent growth on the employment front for July, and even some wage growth.
Total nonfarm payroll employment rose by 215,000 in July, compared with an average monthly gain of 246,000 over the prior 12 months. In July, job gains occurred in retail trade, health care, professional and technical services, and financial activities...

In July, average hourly earnings for all employees on private nonfarm payrolls rose by 5 cents to $24.99. Over the year, average hourly earnings have risen by 2.1 percent. Average hourly earnings of private-sector production and nonsupervisory employees increased by 3 cents to $21.01 in July.

The change in total nonfarm payroll employment for May was revised from +254,000 to +260,000, and the change for June was revised from +223,000 to +231,000. With these revisions, employment gains in May and June combined were 14,000 higher than previously reported. Over the past 3 months, job gains have averaged 235,000 per month.
After a brief slowdown in hiring in the first few months of the year, things seem to be back into the consistent growth we've seen in the last couple of years.

It also continues to draw the contrast with Wisconsin's lagging record on the jobs front. UW Professor Menzie Chinn broke down the numbers by comparing how Wisconsin's job prospects compare to the rest of the nation over the last 25 years, as well as the stats from the Age of Fitzwalkerstan.
The implied long run elasticity of Wisconsin to US private NFP is 0.69; using the Johansen procedure (no trend in cointegrating vector, four first difference lags) yields a long run elasticity of 0.73, while DOLS(+2,-2) yields an estimate of 0.80. The maximum likelihood and DOLS estimates indicate one can reject the null that the elasticity is unitary.
I'm not stats expert, but what I'm reading out of this is that Wisconsin's rate of growth is somewhere between 0.69% and 0.80% for every 1.0% we get in the nation. But even with that caveat that the state will have slower growth, we have still grown fewer jobs than we should have under Scott Walker.

And it's not by a little either. Dr. Chinn also produces this chart which shows the the expected amount of growth (I think) under the 0.80%-per-1.0% assumption, and then you have a 90% bound around that. As you'll see, even with all of those provisions, WE STILL ARE FALLING SHORT. The red line is the projected amount of growth, the lighter red line is the 90% total, and Wisconsin's actual growth is the blue.

Also worth noting from July's jobs report- if Wisconsin had kept up with U.S. private sector job growth since Walker took office in January 2011, we would have added just below 248,000 jobs. Instead we are nearly 100,000 behind that pace. And no Scotty, the Fox News debate wasn't the last time you'll be asked about that failure, and saying you "aimed high" isn't an acceptable excuse.

1 comment:

  1. The program Planet Money in May of 2011 did a segment on what the government could actually do to create jobs. In it Walker's 250k job promise was describe as shrewd in that it was estimated that in a 4yr period employment should grow by 190k if he did nothing and that his policies only needed increase it by 60k. Unfortunately he didn't do nothing. As for "aiming high" he had said that 250k was the floor not the ceiling. Only in an upside down mindset can aiming at the floor be describe as aiming high.