Non-farm payroll employment in September was slightly above consensus (263K vs. 250K), showing continued growth. This is the picture of the main macroeconomic indicators tracked by the NBER’s business cycle dating committee, plus monthly GDP from IHS-Markit.
Figure 1: Non-agricultural wage employment (dark blue), Bloomberg consensus at 10/4 for NFP (blue +), civilian employment (orange), industrial production (red), personal income excluding transfers in Ch.2012$ (green), industry and trade sales in Ch.2012$ (black), consumption in Ch.2012$ (light blue) and monthly GDP in Ch.2012$ (pink), official GDP (blue bars), all logarithmic normalized to 2021M11=0. Lilac shading indicates dates associated with a hypothetical first-half recession. Source: BLS, Federal Reserve, BEA, via FRED, IHS Markit (née Macroeconomic Advisers) (published 4/10/2022) and author’s calculations.
Among these, employment and personal income excluding current transfers occupy a central place. Therefore, the employment report is remarkable for its strength (continued).
The preliminary revision to the benchmark indicates that the labor market has been stronger than the official NFP series indicate. In Figure 2, I show the official series (blue), the revised implicit benchmark series (light blue), and the Civilian Employment series from the Current Population Survey, fitted to the non-farm payroll concept (red).
Figure 1: Non-farm payroll employment (dark blue), implicit series incorporating a preliminary benchmark revision (light blue), civilian employment adjusted to the concept of non-farm payroll (red), in thousands, sa, all on a logarithmic scale. Lilac shading indicates dates associated with a hypothetical first-half recession. Source: BLS and author’s calculations.
Note the continued growth in the labor series even during the slowdown in GDP in the first half of the year, which some observers have called a period of recession.