the latest news release we saw an increase in the Civilian Noninstitutional
Population (CNP) of 189,000 (those people 16+ who are not in the military,
prison, or counted in some other institutionalized setting).
Labor Force (LF) (those Employed 272,000 + those Unemployed 125,000 actively
seeking employment) increased by 397,000! We’ll speak to the rising unemployed shortly.
the LF expanded by 397,000 and the CNP grew by only 189,000 (a respectable
number), this pushed the Labor Force Participation Rate up by 0.1%, moving from
62.8% in April to 62.9% in May. This is
a very good thing!
grew by a healthy 272,000 in the Current Population Survey as well as 280,000
in the Payroll or Establishment Survey.
It’s been a while, but it is good to see them moving in the same
Ratio rose by 0.1%, the result of a robust Employment figure compared to the
CNP (Employed 272,000 / CNP 189,000): the Employment-Population Ratio needle
moved from 59.3% to 59.4%.
rose by 125,000. Now how can that be a
good thing you ask? The key to this is
that U3 Unemployment counts those people who are not employed, but are actively
seeking employment. Stick with this for
Unemployment Rate ticked up by 0.1%, going from 5.4% in April to 5.5% in May
2015. How can this be viewed as a
positive thing? The key here is to focus
on the unemployed as a measure of those not employed, but SEEKING
EMPLOYMENT. Whether or not this
translates into higher employment levels in the subsequent months ahead remains
to be seen, but this may well be a good indicator – we’ll see.
in the Labor Force dropped by 208,000 in the month of May…wow! What does this mean? Well, on a NET BASIS, we saw the
grew by 189,000
LF grew by 397,000 (of that 272,000 were added to the Employed and 125,000 flowed
into the ranks of the Unemployed)
189,000 = LF 397,000 + Not in LF -208,000
So, in essence, with
the Labor Force expanding by more than the working age population actually
grew, then this means that 208,000 people moved from the sidelines back into
What does this latest monthly (Labor) report
this is only one month, it provides us with a very good blueprint of what a
healthy month should look like:
1) An expanding labor force – hopefully larger than the additions to the
working age population (Civilian Noninstitutional Population)
Static or even rising unemployment (pulling people back into the labor force)
for several months to come
Shrinking or static ‘not in the labor force’ component
Last words…Employment finally back to
the 2007 level
(Nov 2007 to Sep 2014 --- nearly 7 years)
point is that as we have indicated in the past, it was not until September 2014
that we clawed back to the pre-recession employment levels (146.6 million) from
November 2007 (146.6 million) [note: according the NBER – National Bureau of
Economic Research http://www.nber.org/cycles.html ,
the recession went from December 2007 – June 2009 --- go figure]. To further press the point home, the CNP or
Civilian Noninstitutional Population expanded by 15.5 million in that same time
We have a lot of ground to make up in the months/years to come.