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The Government Shutdown
Fri October 4, 2013
The 'Faux Friday' Jobs Report: What Economists Can Guesstimate
Thanks to the federal government's partial shutdown, the Bureau of Labor Statistics skipped its monthly Big Reveal at 8:30 a.m. Friday.
There was no September employment report.
Without access to the BLS numbers, data junkies were left to scrounge around for lesser reports. Maybe if they could suck in enough small hits of other statistics, they could feel that old familiar rush?
Nope. Nothing can replace that BLS high.
"You do miss it," said Harry Holzer, Georgetown professor and former chief economist for the Labor Department. "I watch it closely. It's the single best number to explain what's going on" in the U.S. labor market, he said.
The BLS report surveys both employers and households. Also, it comes out monthly, rather than quarterly. Holzer said that frequency provides enough snapshots of wages and hours to create a kind of flowing documentary about jobs.
So here we are — with no new picture to advance the story.
But instead of dwelling on what we don't have, let's think of this as "Faux Friday" — a day offering plenty of data, just not from the BLS. Simply lower your standards, pop open a near-beer and let's go over the almost-important data that we did get this week:
-- ADP's payroll report showed a gain of 166,000 private sector jobs for September — in line with what employers had been adding all summer.
-- Initial claims for unemployment benefits increased by 1,000 to a seasonally adjusted 308,000 last week. That number, based on state data, was somewhat better than the expected 314,000 new claims.
-- PNC Financial Services Group Inc.'s Autumn Outlook survey of small and medium-size businesses showed 16 percent intend to add full-time employees during the next six months, while 8 percent plan to cut workers.
-- The outplacement firm Challenger, Gray and Christmas said companies announced plans for 40,289 layoffs in September, down 20 percent from August.
-- Glassdoor, an online site for jobs, released its quarterly Employment Confidence Survey, conducted online by Harris Interactive. That showed only 15 percent of employees are afraid of being laid off, the lowest percentage since the fourth quarter of 2008.
So when economists look at such surveys and tabulations, what do they see?
Nothing surprising, Holzer said. The reports all suggest that in September, the U.S. economy continued to generate jobs at a pace somewhere between 150,000 and 200,000 — right in line what has been happening for months, he said.
IHS Global Insight, the forecasting firm, said that "September employment growth, once the report is released, will come in at 150,000" new jobs nationwide.
At PNC, chief economist Stuart Hoffman was slightly more upbeat. He said the report will show 180,000 jobs were added, and that the unemployment rate held unchanged at 7.3 percent.
But then again, without BLS data, the uncertainty level among economists is greater because they lack revisions to previous data, he said. Each month, the BLS not only reports what it has found over the last four weeks but also revises figures going back a couple of months.
Those updates are vital to understanding recent trends, Hoffman said. "It's not only the most current month that matters, but the numbers you have to add back or subtract from previous months," he said.
Without the official federal employment report, "we know less," he said. "We don't have the good, usable data."
Still, at 8:30 a.m. when the report was supposed to have been issued Friday, Hoffman remained calm. Instead of staring at the BLS website as he normally would have been doing, "I just got some other work done," he said.
It may be a good idea to get ahead on other tasks, because sooner or later, the government will reopen — and begin churning out pent-up statistics. "Eventually, they are going to deluge us with data," he said.