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Lower Your Expectations for Friday’s Jobs Report
A non-weather warning: Friday’s employment report may disappoint. Here’s why: the Bureau of Labor Statistics’ Payroll Survey embodies the 12th of each month, and for January, that happened to be the absolute peak of the omicron wave. If an employee is sick and doesn’t receive a paycheck, the BLS doesn’t count them.
As we explained in a previous Week in Review column (see “Census Bureau Experimental Household Pulse Survey), of the 107 million people who didn’t work from Dec. 29 to Jan. 10, about 8.2 million (8.8%) of them were “caring for someone or sick myself with coronavirus symptoms.” That’s up from about 3 million people (2.9% of people who didn’t work) during the first two weeks of December.
Today’s ADP® Employment Report shows U.S. private nonfarm employment down about 300,000 jobs in January. Right now, the consensus “forecast” has U.S. payrolls growing by about 150,000 jobs in January (“forecast” is a euphemism for wild guess, in this instance).
Bottom line: the January payroll employment data that come out on Friday: a) won’t look pretty and b) won’t mean much. For this month, pay more attention to data from the household survey (I explain the difference between the surveys in this post). Individuals may consider themselves employed even if the BLS’ establishment survey doesn’t, though it’s entirely likely some of those people too sick to go to work are too sick to respond to a survey.
The nicest thing I can say about Friday’s employment report is that it’s likely to be better than what the Washington Football Team came up with for their new name. It’s not a name that commands a lot of respect.
More to come on Friday!