Friday, June 1, 2012

A hidden surprise in the US employment report

Today's employment report brought with it all sorts of negative economic surprises, creating a sharp drop in the Citi Economic Surprise Index.

Citi Economic Surprise Index
Bloomberg: - The Citigroup Economic Surprise Index for the U.S., which measures how much data is missing or beating the median estimates in Bloomberg surveys, fell to minus 53.6, the lowest since September. It turned negative this year in April after remaining above zero since October. The Federal Reserve announced a program dubbed “Operation Twist” to boost growth on Sept. 21, 2011, four months after the index turned negative.
One of the worst surprises buried in the report however was the fact that all the job growth came from increases in part-time jobs. The number of full-time jobs actually declined significantly.
WSJ: - ... the job growth is coming entirely from workers getting part-time jobs. The number of Americans working full-time fell by 266,000 in May, erasing all the gains of the past three months. The total employment figure only rose because 618,000 more people got part-time jobs. Many of those people would rather be working full-time: The number of people classified as “part time for economic reasons” — meaning they’re working part-time because they can’t find a full-time job — rose by 245,000 to 8.1 million.
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