The Labor Force Participation Rate (LFPR) is a simple computation: You take the Civilian Labor Force (people age 16 and over employed or seeking employment) and divide it by the Civilian Noninstitutional Population (those 16 and over not in the military and or committed to an institution). The result is the participation rate expressed as a percent.
Note: This commentary has been updated with the latest numbers from last week's Employment Report. This is not the scenario that would have been envisioned a generation ago for the "Golden Years" of retirement. Consider: Today nearly one in three of the 65-69 cohort and about one in five of the 70-74 cohort are in the labor force.
The Department of Labor has monthly data on employment by industry categories reaching back to 1939. At the highest level, all jobs are categorized in either Service-Providing Industries or Goods Producing Industries. The adjacent chart illustrates the ratio of the two since 1939. The latest monthly employment report showed a gain of 211K nonfarm payrolls, which consists of a gain of 190K service-providing jobs and 21K goods-producing jobs. Goods-producing employment has contracted for three of the past six months.
The latest issue of the NFIB Small Business Economic Trends came out this morning. The headline number for April came in at 104.5, a decrease of 0.2 from the previous month's 104.7. The index is at the 97th percentile in this series. Today's number came in above the Investing.com forecast of 104.0.
The latest JOLTS report (Job Openings and Labor Turnover Summary), with data through March, is now available. The time frame is quite limited compared to the main BLS data series in the monthly employment report, many of which go back to 1948, and the enormously popular Nonfarm Employment (PAYEMS) series goes back to 1939, while the BLS began tracking JOLTS in December 2000. Nevertheless, there are some clear JOLTS correlations with the most recent business cycle trends.
The LMCI is a relatively recent indicator developed by Federal Reserve economists to assess changes in the labor market conditions. The latest LMCI update came in at 3.6, down from the previous month's revised number. The cumulative index is currently at its post-recession peak.
Let's take a closer look at recent activity in US Treasuries. The yield on the 10-year note ended the day at 2.39% and the 30-year bond closed at 3.02%, reaching levels seen before the election. The 2-10 yield spread is now at 1.06%.
What are the long-term trends for multiple jobholders in the US? The Bureau of Labor Statistics has two decades of historical data to enlighten us on that topic, courtesy of Table A-16 in the monthly Current Population Survey. At present, multiple jobholders account for just five percent of civilian employment. The survey captures data for four subcategories of the multi-job workforce, the current relative sizes of which we've illustrated in a pie chart.
Let's take a close look at Friday's employment report numbers on Full and Part-Time Employment. Buried near the bottom of Table A-9 of the government's Employment Situation Summary are the numbers for Full- and Part-Time Workers, with 35-or-more hours as the arbitrary divide between the two categories. The source is the monthly Current Population Survey (CPS) of households. The focus is on total hours worked regardless of whether the hours are from a single or multiple jobs.
What does the ratio of unemployment claims tell us about where we are in the business cycle and our current recession risk? At present, the ratio for Continued Claims has been trending down. Excluding the 1981 recession, the Initial Claims trough lead time for a recession has ranged from 7 to 22 months with an average of 12 months if we include the 1981 recession and 14 months if we exclude it. Admittedly, the last recession is an extreme example, but the Initial Claims trough preceded its December 2007 onset by a whopping 22 months.