skip navigation

By the Numbers

Featuring brief segments of economic analysis from our senior economist Michael Bazdarich, PhD.

The economic analysis we previously featured in By the Numbers is now available on the Western Asset Blog. This page will no longer be updated.

What Goes Up Must Come Down? Well, Yes, for Jobs Data

Private-sector payroll jobs showed a February gain of only +25,000 today, though the January level was revised up by a hefty +30,000. In other words, after the barnburner January gain of 308,000, we came back to ground—below ground?—in February. The "core" job growth measure we track—private-sector excluding construction and real estate—swung similarly, with a 62,000 gain in February following a 241,000 gain in January, the latter boosted by +41,000 of upward revisions.

When analyzing last month’s strong report, we cautioned that there is tremendous seasonality in the data at this time of year, and the wild swings between January and February reflect this. Our core jobs measure excludes construction and retailing precisely because of their volatility around the holidays and winter, and you can see that the core measure did not swing nearly as wildly as did the headline data.

Meanwhile, our core measure does include another sector subject to occasional seasonal swings: leisure and hospitality, that is, hotels and restaurants. This sector showed a (revised) gain of +59,000 in January, but only +4,000 in February, also likely a reflection of a spurious gain that was subsequently "averaged out."

With any government data series, it is good to average the data over a few months, especially when we are at this time of the year and especially when we are seeing wild swings both to the up and down sides. The accompanying chart varies our typical job growth take by showing three-month average changes instead of one-month changes. This chart summarizes the jobs picture very succinctly and very well.

Despite the weak February print, the three-month average growth rate for jobs through February is still above the average pace of the last few years (blue line). What is more, you can clearly see a trend toward better job growth over the past year, a trend that today’s data do not threaten.

Last month, we also commented that the payroll data indicated some slowing in the pace of manufacturing growth. Those indications continued this month, with factory workweeks declining even alongside decent production job growth. All in all, the data indicate slower growth than we saw in 2018, but nothing to stoke recession fears.

Private-Sector Job Growth
Private-Sector Job Growth
Source: Bureau of Labor Statistics. As of 28 Feb 19

Michael Bazdarich

Product Specialist/Economist

Mike brings more than 45 years of experience to his position. "By the Numbers" will address economic data releases that are pertinent to a broad range of investors.

Prior to joining the Firm in 2005, Mike ran his own consulting firm, MB Economics. He earned his PhD in Economics at the University of Chicago.

Sign up to receive email updates as new reports are released.

© Western Asset Management Company, LLC 2022. This publication is the property of Western Asset and is intended for the sole use of its clients, consultants, and other intended recipients. It should not be forwarded to any other person. Contents herein should be treated as confidential and proprietary information. This material may not be reproduced or used in any form or medium without express written permission.
Past results are not indicative of future investment results. This publication is for informational purposes only and reflects the current opinions of Western Asset. Information contained herein is believed to be accurate, but cannot be guaranteed. Opinions represented are not intended as an offer or solicitation with respect to the purchase or sale of any security and are subject to change without notice. Statements in this material should not be considered investment advice. Employees and/or clients of Western Asset may have a position in the securities mentioned. This publication has been prepared without taking into account your objectives, financial situation or needs. Before acting on this information, you should consider its appropriateness having regard to your objectives, financial situation or needs. It is your responsibility to be aware of and observe the applicable laws and regulations of your country of residence.
Western Asset Management Company Distribuidora de Títulos e Valores Mobiliários Limitada is authorized and regulated by Comissão de Valores Mobiliários and Brazilian Central Bank. Western Asset Management Company Pty Ltd ABN 41 117 767 923 is the holder of the Australian Financial Services Licence 303160. Western Asset Management Company Pte. Ltd. Co. Reg. No. 200007692R is a holder of a Capital Markets Services Licence for fund management and regulated by the Monetary Authority of Singapore. Western Asset Management Company Ltd is a registered Financial Instruments Business Operator and regulated by the Financial Services Agency of Japan. Western Asset Management Company Limited is authorised and regulated by the Financial Conduct Authority (“FCA”) (FRN 145930). This communication is intended for distribution to Professional Clients only if deemed to be a financial promotion in the UK as defined by the FCA. This communication may also be intended for certain EEA countries where Western Asset has been granted permission to do so. For the current list of the approved EEA countries please contact Western Asset at +44 (0)20 7422 3000.