September Jobs +114,000; Unemployment Rate 7.8%; Part-Time Workers +582,000; Initial Reaction and Election Impact

Courtesy of Mish.

Initial Reaction and Election Impact

The establishment report of +114,000 jobs was pretty much about what most expected. The four-month average is a mere 120,000 a month (a very weak set of establishment numbers for this point in a recovery).

However, the household survey surprise shows the unemployment rate fell three-tenths of a percent to 7.8%.

On the surface, this is a solid showing, and 100% certain to boost the Obama campaign. I suggest these numbers will overshadow a horrendously weak performance by the president in the debate.

That said, a closer look shows the entire drop in the unemployment rate can be attributed to a surprise rise of 582,000 in part-time workers. U-6 unemployment remained at 14.7%. U-6 includes part-time workers who want a full-time job.

Still, all things considered, this was the strongest report in four months.

Does it change my recession outlook?

No, it doesn’t. A one-month potential outlier based primarily on a rise in part-time employment, accompanied by other weak data does not change my perception.

Jobs Report at a Glance

Here is an overview of today’s release.

  • September Payrolls +114,000 – Establishment Survey
  • Four-month average +120,000 – Establishment Survey
  • US Employment +873,000 – Household Survey
  • Involuntary Part-Time Work +582,000 – Household Survey
  • Baseline Unemployment Rate -.03 at 7.8% – Household Survey
  • U-6 unemployment did not drop. It remained at 14.7%.
  • The Civilian Labor Force +418,000

Recall that the unemployment rate varies in accordance with the Household Survey not the reported headline jobs number, and not in accordance with the weekly claims data….

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