Anyone looking for a silver lining in the Labor Department's latest readout on the U.S. job market can expect to turn up lead. But just how lousy are the numbers? Masochists may read on to get a sense of why Friday's employment report is especially painful.
1. Swing and a miss. The 142,000,000 jobs employers added in September badly undershot the consensus forecast of 200,000 in payroll gains. For professional forecasters that amounts to an almighty whiff -- the experts just didn't see it coming. More seriously, the downbeat data suggest that the malaise afflicting China, Japan, Brazil and other major economies is infecting the U.S.
2. Summertime blues. It wasn't only September that stank. The pace of job-creation in July and August was also significantly weaker-than-previously thought. That pushed the three-month average of private-sector job growth to its lowest level in nearly six years, economist Dean Baker notes.
3. Money talks. If there is one number that encapsulates why the post-recession recovery has been so slow, it's anemic wage growth. And the anemia persists -- workers saw exactly zero gain in their pay last month. For the year, average hourly earnings are rising 2.2 percent, roughly the same meager pace of growth that has characterized the entire recovery. If the job market were as strong as the nation's 5.1 percent unemployment rate suggests, wages should be growing much faster. The upshot, as one Deutsche Bank analyst put it: "There has been virtually no acceleration in wage growth."
4. Weakness across the board. Employers across all major sectors pulled back on hiring last month. Job growth slowed not only in manufacturing, which has been sucking wind for months because of the stronger dollar and weakening demand overseas, but also in industries such as health, education and retail. Those sectors typically don't do that much business outside the U.S. That may suggest that whatever is ailing the economy goes beyond a temporary blip in exports.
5. Missing persons. The main reason the jobless rate held steady was that lots of people stopped looking for work. The labor force participation rate, which is the percentage of working-age adults who are employed or looking for work, fell in September to 62.4 percent. That's the lowest in 38 years. The employment-to-population ratio, or the share of Americans aged 16 and older who are employed, remains 3.5 percent below its high point just before the recession. Taken together, these figures show that the job market isn't close to being fully healed.
It's worth remembering that monthly job figures are volatile -- the September figures could well be revised upward when October rolls around. Most economists also think the U.S. is likely to be spared the worst of the slump afflicting other countries. But the latest labor numbers amount to a serious chink in that belief. They're also a sign that, in an economically interconnected age, one country's pain is usually another's.