Econintersect: For day four of the government shutdown, the data casualty is the Bureau of Labor Static’s (BLS) jobs report. There continues to be no light in the tunnel so one could understand if progress to end the shutdown was occurring. Econintersect provides insight into what it could have said.
Bottom lines:
- Once the weekly initial weekly unemployment claims falls below 350,000 (the current situation) – correlation between initial claims and the employment report is lost. So initial unemployment claims offers little reliable insight.
- The market expected (from Yahoo finance):
| Statistic | Actual | Briefing Forecast | Market Expects | Prior |
| ADP Employment Change | 166K | 180K | 170K | 159K |
| Nonfarm Payrolls | – | 165K | 183K | 169K |
| Nonfarm Private Payrolls | – | 180K | 183K | 152K |
| Unemployment Rate | – | 7.3% | 7.3% | 7.3% |
| Hourly Earnings | – | 0.2% | 0.2% | 0.2% |
| Average Workweek | – | 34.5 | 34.5 | 34.5 |
- Econintersect forecast jobs at 160,000 based on economic pressures in its economic forecast for September (released in late August).
- Trends continue until they do not continue. Here we have a problem in estimating. ADP’s data showed a trend change. Would the BLS data also show a trend change? If the current BLS trends continued, non-farm private payrolls would be 200,000 – if they rollover (similar to ADP) – then the BLS September non-farm payroll growth would come in at 180,000. As the BLS has been shadowing ADP’s number for the last few months – we could expect a number in the range of 160K to 170K.
