Saturday, October 5, 2024

Big jobs report for September. In pretty much any way you want.

One month before the election, it was Jobs Report Friday this week! So what did we get?

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Yep, it was a bigtime jobs report. On the payrolls side, gains were strong in a lot of areas, including continued strength in health care and a welcome rebound in leisure and hospitality. And the construction industry also kept hiring workers.
Employment in food services and drinking places rose by 69,000 in September, well above the average monthly gain of 14,000 over the prior 12 months.

Health care added 45,000 jobs in September, below the average monthly gain of 57,000 over the prior 12 months. Over the month, employment rose in home health care services (+13,000), hospitals (+12,000), and nursing and residential care facilities (+9,000).

Employment in social assistance increased by 27,000 in September, primarily in individual and family services (+21,000). Over the prior 12 months, social assistance had added an average of 21,000 jobs per month.

Construction employment continued to trend up in September (+25,000), similar to the average monthly gain over the prior 12 months (+19,000). Over the month, nonresidential specialty trade contractors added 17,000 jobs.
Also nice to see that unemployment dropped for the “good reason” – more people entering the work force, but even more Americans than that amount saying that they are now working.

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“But c’mon Jake, you know this is going to be revised down, like they were in the past.” Revisions, you say?
The change in total nonfarm payroll employment for July was revised up by 55,000, from +89,000 to +144,000, and the change for August was revised up by 17,000, from +142,000 to +159,000. With these revisions, employment in July and August combined is 72,000 higher than previously reported.
"But it's all foreigners that are getting the jobs. Try again, MAGAts.

So this is a blowout report, almost to a point where it’s too strong. Because it might slow down the speed of future interest rate cuts that the Federal Reserve may put in.
Within minutes, traders of futures that settle to the Fed's policy rate had all but abandoned bets on another upsized interest rate reduction before the end of this year, and moved to price in quarter-point reductions instead.

They are also pricing in an end point to the rate-cutting at somewhere between 3.25% and 3.75% by the middle of next year, above the 3.00% to 3.25% end-point range that traders had previously seen likely. The current range is 4.75% to 5.00%....

Friday's jobs report "is a potential game changer for the Fed and market expectations on the size and pace of future rate cuts," BMO economists wrote. "It also is a big upside risk to our consumer spending and GDP growth forecasts in the near-term."

Expectations could still change before the Fed's Nov. 6-7 policy meeting, which will come after fresh data on inflation and another monthly jobs report.
Oh no! We have a strong jobs market with good wage growth! Whatever will we do!

The wage increases are also nice to see, and continue a positive trend. We already knew that inflation-adjusted median household incomes had recovered back to 2019’s levels for 2023, and before today’s report, we had seen average hourly wages went up by 2.6% through August while the CPI only rose by 1.7%.

Now add in another 0.4% increase for September with hourly wages, and the knowledge that gas prices continued to trend down last month while food prices haven’t changed much, and it seems likely that those real wage gains are even larger now.

Republicans took the good jobs news in stride.

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And Little Marco shrinks even more….

It again illustrates that a big question in this election comes down to whether voters are looking around and recognizing that the US has a strong economy with continued job growth and wage gains, and want to keep this going. Or do more voters buy the “crippling inflation and tough times” theme that Republicans are trying to sell (with no GOP solutions for these (non)-problems, mind you).

If we have an electorate that votes based on facts and reality, then Kamala Harris and the Dems should win. Which is likely why Republicans are spending so much ad money trying to convince people that what they’re seeing in their communities and in the economy in general isn’t real. Or that "scary" illegal immigrants and trans people are around every corner and.... existing?

Don’t be stupid, people. Believe what we see in the real world, and not the one that the TV ads and their oligarch funders are trying to convince you of.
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