This Friday the BLS jobs report for April will drop. Most predictions are fairly sunny, with analysts expecting more of the slow and steady growth we’ve seen since the start of the year. This also being earnings season, I figured the report might end up buried under market speculation and thought I’d pull out the five things, beyond the big numbers, that I’ll be watching for in this month’s report. In addition to key indicators like overall employment and wage growth, I’ll be digging into the report for information on regional and sector disparities, youth employment trends, underemployment and where America stands in the global employment picture.
1. Wage Growth
Quarter after quarter, wage growth has been so slow as to be measured in single digit fluctuations, a little bit up, a little bit down, but for the most part, slow and steady. As other key indicators in the monthly BLS report have gotten increasingly promising, wage growth has continued to lag behind. Along with underemployment and labour participation, slow wage growth is now one of the major factors for why low income Americans continue to struggle. And although #Fightfor15 has had some recent victories, several of their wins don’t come into affect this quarter, the next, or even for years to come. Their win in California, for example, won’t see the minimum wage reach $15 until 2022.
2. Underemployment and Labour Participation
Like wage growth, underemployment is a lingering ill, a less than silver lining in the story of economic recovery. Although March’s report pegged unemployment at 5%, it showed underemployment at 9.8%. Still, the labour participation rate paints a much less sunny picture, at 62.2%. So although the jobless rate, based on unemployment claims, is said to be at a 42-year-low, so too is the labour participation rate, based on those still actively looking for work, is also at a 38-year-low. In isolation that 5% unemployment figure looks grand, but when considered in concert with jobless claims and labour participation, the complexity of employment success is much clearer. As Sarah Kendzior puts it, that 5% unemployment rate feels like a lie to many Americans.
3. Sector By Sector: Who’s Winning and Who’s Losing
The big numbers are great. 200,000 non-farm payroll jobs added! Fantastic! But without digging any deeper, they’re ultimately meaningless. What’s important isn’t just that Americans are working — and the trend is towards continued recovery, all my doomsaying aside — but what they’re working on and where they’re doing it. The construction, service, tech and medical sectors have seen fairly consistent growth over the last few years, with mining and energy shedding jobs in the face of poor oil prices. And even within sectors, job growth is unequal in numbers and impact: the difference between a financial and food service job is vast, for example. In addition to the what, the where is also important; the geography of resource and tech based work has a tremendous impact on the American economy as a whole, and many implications that recruiters should consider. Look for rural and urban employment numbers, regional disparities and sectors in trouble.
4. How Earnings Reports Affect Interpretation of BLS Report
April’s jobs report drops smack in the middle of earnings season, as pundits and financial analysts pore over first quarter growth. The story so far has been hectic, particularly in the tech industry with surprising results from Alphabet, Apple and Facebook (not so surprising is Twitter’s lacklustre numbers). With the tech industry accounting for more and more of the country’s employment growth, look to see those reports affect how Friday’s BLS numbers are interpreted. But with retailers reporting this week, we’ll be talking more and more about the American “consumer,” and less about social media and tech numbers. The jobs report, combined with retailer earnings reports, has every chance of sending the markets, yet again, into turmoil.
5. The International Picture
It’s not just the American jobs report that drops this week — several international labour departments will be reporting on April employment numbers as well. In an increasingly global economy, and an increasingly global employment market, the jobs reports of big international economies and key sources of American immigration and are important for stateside business leaders to watch. The slower Canadian economy, for example, should have recruiters thinking about the highly educated but underemployed and comparatively underpaid Canadian workforce. Meanwhile, the Chinese job market remains fairly steady, despite the country’s market woes and slow economic growth, and the Eurozone economy is seeing growth America can only dream of. All of this has an impact on American businesses.
In 2016, there’s no excuse not to be keeping an eye on international job growth.