August US jobs report fiddled – again!

Okay, I get these monthly non-farm payroll guesstimates are meant to manipulate rather than illuminate markets, but the hysterical headlines by many supposedly reputable legacy news platform got me wondering whether they had suddenly discovered satire. “Wow, wow, wow! … We’re cooking in grease on this report.” CNBC’s Santelli reported, while the Wall Street Joural chimed in with “U.S. Adds a Whopping 162,000 Jobs in a Bright Spot for the Economy”, frameing the data as a definitive sign that the labor market had successfully shaken off its early-summer doldrums. So what was behind all of this was that the “US added 162,000 jobs in August, smashing expectations.”, of +53k MoM jobs. There is however, one small problem here, that being the BIS goosed the August jobs data by +130k by adjusting up the seasonal adjustement by the same amount. Strip out the +25k increase in Government jobs and the reported increase in private sector jobs number drops to +127k, but then remove the +130k seasonal adjustment and the underlying change in August private sector jobs was -3k down on the month. Oops!

By sector however, the contraction remains heavily focussed on Information Services, reflecting the ongoing staff reductions as budgets shift over to AI. Other segments seem to have held up, but these are reported on the new seasponal adjustement so are not reliable.

Looking from the other end of the lens, the usually more reliable insured unemployment claims data suggests little overall change in momentum from the existing steady, but muted trajectory.

That in turn is also supported by the slowing, but still rising average hourly wages

All this meanwhile begs the question of Why? Why goose a flacid jobs report, as it is hardly a reliable basis for a Fed loosening, as the growth is fictional and it doesn’t take much effort to realise that? Perhaps after all that recent support for the JPY, the Fed is now hoping for some support for the USD to return, but on the basis of improved GDP expectations rather than hopes for a rate increase.