NRF REPORTS INCREASE IN RETAIL EMPLOYMENT

The NRF (National Retail Federation) commented on the Labor Department’s report that retail employment (excluding gasoline stations, automobiles and restaurants) was up 51,100 jobs in February. Compared with February 2015, retail jobs were up by 247,300. Apparel stores saw a significant gain of 11,100 jobs. The NRF noted that weather played a big part of the increase.

“Weather has a serious impact on the retail industry, and when cold winter weather finally made its appearance shoppers headed to stores and brought shopping patterns to a good level,” said National Retail Federation chief economist Jack Kleinhenz said. “This solid report shows that the consumer is confident and continuing to shop.”

Source: Retailing Today

Analyzing Friday's Labor Report

Mark Twain famously said, "get your facts first, then you can distort them as you please."  As data analyst we have a responsibility to provide an accurate and complete picture when we poor through numbers and create reports.  The labor report released on Friday provides a great example of an incomplete reporting of the facts. 

If I told you sales for last quarter are up 5% from the prior quarter that would be good news right?  But what if I failed to tell you sales for the company's three new products had fallen 35%.  That would be a key piece of information that might change your view on the company's performance last quarter.  Friday's unemployment report, while good news, only tells part of the story.  Here is the positive part -  nonfarm payrolls rose a seasonally adjusted 271,000 in October taking the unemployment rate down to 5%.  Average hourly earnings of private sector workers rose at a 2.5% annual pace in October. 

However, here is the part which was not included in most of the news stories... the labor force participation rate remained unchanged from September at 62.4, and the labor force participation rate has not been that low since 1978. (see accompanying chart)  94,513,000 Americans who are working age are not working or actively seeking a job.   Retiring baby boomers explains about half of the drop in the participation rate and that trend will continue. The second factor is that people are choosing to go back to school or stay in school longer. The number of individuals enrolled in post-secondary degree granting institutions ballooned to more than 52 percent between 1990 and 2014 according to the National Center for Education Statistics.  Another factor is a sharp increase in the number of Americans on disability.  With an aging labor force that trend is also expected to continue. 

Labor Force Participation Rate

As data analysts our job is to tell the entire story - the good and the bad - so that quality decisions can be made.   

CONSUMER PRICE INDEX HIGHER IN FEBRUARY

After sinking 0.7% in January, the biggest drop in 6 years, the consumer price index rose 0.2% in February. This is attributed to a rise in gas costs and broad increases in other categories.

Outside of food and energy, the cost of rents, clothes, new and used cars and airfares all also increased 0.2% last month. Even with February’s uptick in prices, economists expect the strong dollar to keep inflation in check in coming months because it makes imported goods cheaper. The dollar has risen sharply in value in the past year compared with the euro and yen, in part because the U.S. economy is growing faster than those in Europe and Japan.

“It is too early to say inflation is turning higher,” said Jennifer Lee, an economist at BMO Capital Markets. The dollar’s strength “takes time to filter through to prices, and the recent increase will show up in coming months.”

The Fed has said in a statement that it might be appropriate for an interest rate increase after further improvement in the labor market, as long as inflation remains at its 2% target.

Source: Austin Statesman

SLUGGISH US CONSUMER SPENDING START TO 2015

January US consumer spending barely rose .1 percent, despite cheaper gasoline and a buoyant labor market. Economists are speculating that consumers were using their extra income to pay down debt and boost savings. This was below Wall Street’s expectations for a .4 percent increase.

"Should we be worried about the weakness of underlying sales over the past two months? Possibly," said Paul Ashworth, chief U.S. economist at Capital Economics in Toronto.

"But all the conditions are in place for a period of very strong consumption growth. We still expect to see that strength come through in the retail sales data soon."

The economy has added more than a million jobs in the past three months and the number of those seeking jobs hit its lowest level since 2007 in December.

Resource: Reuters

Retailers Added 2,000 Jobs In December, Bringing Total To 176,000 In 2014

January 9, 2015

Retail industry employment increased by 2,000 jobs in December as healthy hiring gains in general merchandise and sporting goods stores were offset by declines in clothing and furniture stores, the National Retail Federation said today.  Retail employment for 2014 climbed by 176,000 jobs over the year before, according to NRF's calculations, which do not include automobile dealerships, gasoline stations or restaurants.

"Once again, today's jobs report was very strong and shows that the labor market is maturing and the economy is performing soundly," NRF Chief Economist Jack Kleinhenz said.  "It is the largest annual increase in overall employment since 1999.  While retail employment witnessed large swings in December, it was wholly consistent with seasonal patterns."

"However, data on average hourly earnings was very disappointing," Kleinhenz said.  "While the labor market has recovered from recessionary lows, it's still not strong enough to generate or pressure wage increases."

"While labor slack is diminishing, the recent and notable drop in energy prices combined with anemic wage growth may provide the Federal Reserve more leeway to lift short-term interest rates," Kleinhenz said.  "We continue to expect further revisions into the New Year."

Source: National Retail Federation

The Conference Board Employment Trends Index Increases In December

January 12, 2015

The Conference Board Employment Trends Index (ETI) increased in December.  The index now stands at 128.43, up from 127.83 in November.  This represents a 7.5 percent gain in the ETI compared to a year ago.

"The Employment Trends Index increased in every single month of 2014, capping the year off with strong growth, 2.3 percent, in the final quarter," said Gad Levanon, Managing Director of Macroeconomic and Labor Market Research at The Conference Board.  "The strengthening in the ETI suggests that rapid job growth is likely to continue throughout the first half of 2015.  And as the labor market tightens further, acceleration in wage growth is soon to follow."

December's increase in the ETI was driven by positive contributions from six of the eight components.  In order from the largest positive contributor to the smallest, these were: Percentage of Respondents Who Say They Find "Jobs Hard to Get", Initial Claims for Unemployment Insurance, Industrial Production, Percentage of Firms with Positions Not Able to Fill Right Now, Number of Temporary Employees, and Real Manufacturing and Trade Sales.

The Employment Trends Index aggregates eight labor-market indicators, each of which has proven accurate in its own area.  Aggregating individual indicators into a composite index filters out "noise" to show underlying trends more clearly.

• Percentage of Respondents Who Say They Find "Jobs Hard to Get" (The Conference Board Consumer Confidence Survey)
• Initial Claims for Unemployment Insurance (U.S. Department of Labor)
• Number of Employees Hired by the Temporary-Help Industry (U.S. Bureau of Labor Statistics)
• Ratio of Involuntarily Part-time to All Part-time Workers (BLS)
• Job Openings (BLS)
• Industrial Production (Federal Reserve Board)
• Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis)
• Statistical imputation for the recent month
• Statistical imputation for two recent months

Source: The Conference Board

Best Job Year In More Than A Decade Ends On High Note

January 9, 2015

The economy generated 252,000 new jobs in December, and the gains for November and October were revised up.  These strong gains are likely to continue to boost consumer spending in 2015.  The continued drop in the unemployment rate, to 5.6 percent in December, puts us within striking distance of the natural rate of 5.5 percent.  All the more reason to expect that the Fed will start raising rates in the first half of 2015.  In such an environment we should expect to see acceleration in wage growth, but there is no evidence of that, yet, in the establishment survey.

Source: The Conference Board

The Conference Board Employment Trends Index Increased In November

December 8, 2014

The Conference Board Employment Trends Index (ETI) increased in November.  The index now stands at 123.24, up from 122.8 (a downward revision) in October.  This represents a 6.1 percent gain in the ETI compared to a year ago.

"The Employment Trends Index increased for the 11th straight month in November, and recent solid improvements suggest that strong job growth is likely to continue into early next year," said Gad Levanon, Managing Director of Macroeconomic and Labor Market Research at The Conference Board.  "We will probably reach the natural rate of unemployment, 5.5 percent, within a few months, and these tighter labor market conditions should lead to acceleration in wage growth."

November's increase in the ETI was driven by positive contributions from five of the eight components.  In order from the largest positive contributor to the smallest, these were: Industrial Production, Ratio of Involuntarily Part-time to All Part-time Workers, Number of Temporary Employees, Real Manufacturing and Trade Sales, and Job Openings.

The Employment Trends Inedex aggregates eight labor-market indicators, each of which has proven accurate in its own area.  Aggregating individual indicators into a composite index filters out "noise" to show underlying trends more clearly.

The eight labor-market indicators aggregated into the Employment Trends Index include:

• Percentage of Respondents Who Say They Find "Jobs Hard to Get" (The Conference Board Consumer Confidence Survey)
• Initial Claims for Unemployment Insurance (U.S. Department of Labor)
• Percentage of Firms With Positions Not Able to Fill Right Now (National Federation of Independent Business Research Foundation)
• Number of Employees Hired by the Temporary-Help Industry (U.S. Bureau of Labor Statistics)
• Ratio of Involuntarily Part-time to All Part-time Workers (BLS)
• Job Openings (BLS)
• Industrial Production (Federal Reserve Board)
• Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis)

Source: The Conference Board

Online Labor Demand Rose 170,200 In November

December 3, 2014

•  November posts large gain following flat October
• California, Florida and Texas show strong gains along with MSAs New York, Los Angeles and Seattle

Online advertised vacancies rose 170,200 to 5,253,900 in November, according to The Conference Board Help Wanted OnLine (HWOL) Data Series.  The October Supply/Demand rate stands at 1.77 unemployed for each advertised vacancy with a total of 3.9 million more unemployed workers than the number of advertised vacancies.  The number of unemployed was 9.0 million in October.

"November labor demand shows renewed strength, helping to boost a slow-growth second half of the year," said Gad Levanon, Managing Director, Economic Outlook & Labor Markets at The Conference Board.  "Gains were widespread across states and MSAs with continued positive trend growth across much of the U.S."

In November, the Professional category saw strong gains in Management (17,100), Business and Finance (15,400) and Computer (12,800) with a loss in Healthcare (-11,400).  The Services/Production category saw gains in Office/Admin (43,100), Food (20,100) and Transportation (16,900) with a small drop in Sales (-8,800).  Supply/Demand rates continue to improve, providing better opportunities for job seekers.

Regional And State Highlights

• Most states and all regions posted gains in November

Metro Area Highlights

• In November, 50 metro areas posted gains, one fell, and one remained constant

Occupational Highlights

• In November, of the 10 largest online job categories, two posted declines (healthcare practitioners and technical occupations and sales and related occupations)

Source: The Conference Board 

Retailers Add 37,000 Jobs In November

December 5, 2014

Retail industry employment increased by 37,000 jobs in November, the National Retail Federation said today.  Consistent with seasonal hiring patterns, employment gains were seen in most retail categories, including a marked increase of 11,300 jobs in clothing and clothing accessories stores.  NRF does not include automobile dealerships, gasoline stations or restaurants in its calculations.

"Today's robust jobs report shows a broadening improvement in the labor market and confirms expectations of a strengthening and expanding economy," NRF Chief Economist Jack Kleinhenz said.  "Solid seasonal demand, reduced prices at the pump and improving - though erratic - levels of business and consumer confidence have all supported job gains."

"We remain optimistic that we are gaining ground and traction toward a more normal and stable labor market in the near future," Kleinhenz said.  "The real nugget in this report was the gain in average hourly earnings.  Improving wages and salaries will create much-needed pressure in the market and help lift demand."

"The report is consistent with our holiday sales and employment forecast, which concluded that retailers will hire between 730,000 and 790,000 seasonal workers this season," Kleinhenz said.  "Many of those seasonal positions will ultimately turn into full-time jobs next year."

Source: National Retail Federation

Job Growth And Wage Gains Excel In November

December 5, 2014

The economy generated 321,000 new jobs in November, much faster than the average six month change in recent months at 258,000 jobs.  This job report is an especially strong one because it combines with an increase in hourly earnings at 9 cents, which is consistent with the acceleration in wages in the Employment Cost Index, reported last month.  As the labor market continues to tighten in the coming year, we expect to see further improvement in wage growth.  The unemployment rate paused at 5.8 percent but it doesn't change our view that we are only a few months away from reaching the natural rate of 5.5 percent.  Even with low inflation numbers, labor market conditions are pressuring the Fed to raise rates in the first half of 2015.

Source: The Conference Board

The Conference Board Employment Trends Index Increased In October

November 10, 2014

The Conference Board Employment Trends Index (ETI) increased in October.  The index now stands at 123.09, up from 121.91 (an upward revision) in September.  This represents a 7.7 percent gain in the ETI compared to a year ago.

"The Employment Trends Index continues to increase rapidly, with all eight components improving in October," said Gad Levanon, Managing Director of Macroeconomic and Labor Market Research at The Conference Board.  "The index is signaling solid job growth through the winter.  As a result, we could see the unemployment rate reach its natural rate of 5.5 percent by early Spring."

October's increase in the ETI was driven by positive contributions from all eight components.  In order from the largest positive contributor to the smallest, these were: Percentage of Firms With Positions Not Able to Fill Right Now, Initial Claims for Unemployment Insurance, Ratio of Involuntarily Part-time to All Part-time Workers, Number of Temporary Employees, Industrial Production, Percentage of Respondents Who Say They Find "Jobs Hard to Get," Real Manufacturing and Trade Sales, and Job Openings.

The Employment Trends Index aggregates eight labor-market indicators, each of which has proven accurate in its own area.  Aggregating individual indicators into a composite index filters out "noise" to show underlying trends more clearly.

The eight labor-market indicators aggregated into the Employment Trends Index include:

• Percentage of Respondents Who Say They Find "Jobs Hard to Get" (The Conference Board Consumer Confidence Survey)
• Initial Claims for Unemployment Insurance (U.S. Department of Labor)
• Percentage of Firms With Positions Not Able to Fill Right Now (National Federation of Independent Business Research Foundation)
• Number of Employees Hired by the Temporary Help Industry (U.S. Bureau of Labor Statistics)
• Ratio of Involuntarily Part-time to All Part-time Workers (BLS)
• Job Openings (BLS)
• Industrial Production (Federal Reserve Board)
• Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis)

Source:The Conference Board

Labor Market Strength Increases Odds Of Rate Hike

November 7, 2014

The labor market remains resiliently strong, as evidenced by the gain of 214,000 new jobs created in October, close to the average monthly change of 220,000 in the past year.  The combination of strong job growth and only moderate GDP growth suggests that the trend of weak improvement in labor productivity is likely to continue.  The continued drop in the unemployment rate, to 5.8 percent in October, increases the odds that both reaching the natural rate of unemployment and the first Fed rate hike would occur in the first half of 2015.  The decline in the unemployment rate in October occurred for good reasons - strong employment growth and a decline in the number of unemployed - and not due to further departures from the labor force.  However, it remains concerning that despite the tightening of the labor market, the establishment survey has yet to show much acceleration in wage growth.

Source: The Conference Board

Retail Industry Adds 22,100 Jobs In October

November 7, 2014

According to the National Retail Federation, retail industry employment increased by 22,100 jobs in October.  Employment gains were broad and consistent in most retail categories, especially in general merchandise stores, which saw an increase of 11,900 jobs.  NRF figures do not include automobile dealerships, gasoline stations or restaurants.

"Today's solid employment report is an indication that the economy is on firmer turf heading into the all-important holiday shopping season," NRF Chief Economist Jack Kleinhenz said.  "Retail employment growth was broad based with marked increases in a cross section of categories and positions."

"With the labor market steadily improving and hiring increasing, we should witness a corresponding lift in business activity and consumer spending," Kleinhenz said.  "The economy is progressing toward sustainable growth with employment gains key to improved confidence and self-reinforcing economic growth."

NRF forecasts that retailers and merchants will hire between 730,000 and 790,000 seasonal workers this holiday season.

Source: National Retail Federation

Online Labor Demand Edged Up 11,700 In October

November 5, 2014

• Online labor demand continues on a slow growth trend in 2014
• Most states and MSAs showed small gains in October

Online advertised vacancies rose 11,700 to 5,083,600 in October, according to The Conference Board Help Wanted OnLine (HWOL) Data Series, released today.  The September Supply/Demand rate stands at 1.83 unemployed for each advertised vacancy, with a total of 4.2 million more unemployed workers than the number of advertised vacancies.  The number of unemployed was 9.3 million in September.

"U.S. labor demand continues on a steady, slow growth trend, maintaining historically high demand levels with over 5 million ads each month," said Gad Levanon, Director of Macroeconomics and Labor Markets at The Conference Board.  "The data continue to indicate a strong U.S. labor market."

In October, the Services/Production occupational category saw a gain, while the Professional category saw a small loss.  Sales (22,100) and Transportation (23,800) bounced back from large September losses with most other occupational categories showing just small increases/decreases.

Regional and State Highlights

• Fifteen of the 20 largest states posted small gains in October
• Among the 50 states, 31 experienced gains and 16 declined while 3 (Mississippi, Oklahoma, and Montana) remained constant

October Changes for States

In October, online labor demand was up in 31 states, down in 16, and unchanged in 3.  All four regions experienced increases.

Metro Area Highlights

• In October, among the 20 largest metro areas, 15 gained advertisements, 4 lost, and 1 (Boston) remained constant
• Of the 52 metro areas for which Help Wanted OnLine provides monthly data, 36 gained advertisements, 12 lost, and 4 (Boston, Buffalo, Providence, and Indianapolis) remained constant

Metro Area Changes

In October, out of the largest 52 metro areas, online labor demand was up in 36 metro areas and down in 12 while 4 remained constant.  The MSAs with the largest gains in each of the regions were: New York (+11,900) in the Northeast; Seattle-Tacoma (+3,700) and San Francisco (+2,400) in the West; Dallas (+3,300) in the South; and Detroit (+1,600) in the Midwest.

Occupational Highlights

• In October, of the 10 largest online job categories, 7 posted gains and 3 posted declines

Occupational Changes for the Month of October

The largest gain in October was in Transportation ads, which increased 23,800 in October to 336,800 as demand for heavy and tractor-trailer truck drivers increased.  October's gain offsets the September loss of 22,900.  Sales ads increased 22,100 to 608,400 largely due to a rise in demand for retail salespeople.  This gain mostly offsets the September loss of 32,500.

Source: The Conference Board

NRF Forecasts Seasonal Employment To Grow Between 725,000-800,000

October 7, 2014

According to NRF, retailers are expected to hire between 725,000-800,000 seasonal workers this holiday season, potentially more than they actually hired during the 2013 holiday season (768,000).  Seasonal employment in 2013 increased 14 percent over the previous holiday season.

"These holiday positions offer hundreds of thousands of people the opportunity to turn their seasonal position into a long-term career opportunity in retail," said Shay.

Source: National Retail Federation

The Conference Board Employment Trends Index Increased In September Upward Momentum Continues

October 6, 2014

The Conference Board Employment Trends Index (ETI) increased in September.  The index now stands at 121.68, up from 121.32 (an upward revision) in August.  This represents a 6.1 percent gain in the ETI compared to a year ago.

"The Employment Trends Index increased for the ninth consecutive month, signaling solid job growth through year end," said Gad Levanon, Director of Macroeconomic Research at The Conference Board.  "A combination of positive and negative forces has been driving the rapid decline in the unemployment rate in recent years.  Hiring is strong, but productivity growth is weak, and the participation rate continues to decline.  None show signs of reversing."

September's increase in the ETI was driven by positive contributions from six of its eight components.  In order from the largest positive contributor to the smallest, these were: Industrial Production, Real Manufacturing and Trade Sales, Initial Claims for Unemployment Insurance, Ratio of Involuntarily Part-time Workers, Number of Temporary Employees, and Job Openings.

The Employment Trends Index aggregates eight labor-market indicators, each of which has proven accurate in its own area.  Aggregating individual indicators into a composite index filters out "noise" to show underlying trends more clearly.

The eight labor-market indicators aggregated into the Employment Trends Index include:

• Percentage of Respondents Who Say They Find "Jobs Hard to Get" (The Conference Board Consumer Confidence Survey)
• Initial Claims for Unemployment Insurance (U.S. Department of Labor)
• Percentage of Firms With Positions Not Able to Fill Right Now (National Federation of Independent Business Research Foundation)
• Number of Employees Hired by the Temporary-Help Industry (U.S. Bureau of Labor Statistics)
• Ratio of Involuntarily Part-time to All Part-time Workers (BLS)
• Job Openings (BLS)
• Industrial Production (Federal Reserve Board)
• Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis)

Source: The Conference Board

Strong Job Growth On Track

October 3, 2014

The economy generated a gain of 248,000 jobs in September, faster than the averge monthly over the past year, and revisions to July and August were very positive.  The slower gain initially reported for August now appears to have been simply an aberration.  The continued rapid drop in the unemployment rate increases the odds that reaching the natural rate of unemployment and the first Fed rate hike will occur in the first half of 2015.  The one negative piece of information from this report is the ongoing weakness in wage growth.

Source: The Conference Board

Retail Industry Adds 35,500 Jobs In September

October 3, 2014

According to the National Retail Federation's calculations, retail industry employment increased by 35,500 jobs in September, with upward revisions for July and August.  Employment gains were seen in most retail categories with the exception of clothing and clothing accessories stores, which lost 3,000 jobs, and health and personal care stores, which lost 900 jobs.  NRF numbers do not include automobile dealerships or gasoline stations.

"As expected, today's jobs report was positive news for the economy and the markets," NRF Chief Economist Jack Kleinhenz said.  "September's employment figure is roughly in line with its performance over the last six months and shows that the July and August data was just a temporary blip."

"The employment figure should set the table for a healthy fourth quarter as we head into the all-important holiday shopping season," Kleinhenz said.

"Economic data released in September, including the jobless benefits claims, supported stronger payroll growth and employment," Kleinhenz said.  "The jobs report indicates no evidence of wage pressure and should allow the Federal Reserve to stay the course."

The U.S. Bureau of Labor Statics Employment Situation Summary showed that total nonfarm payroll employment rose by 248,000 in September.  The unemployment rate fell slightly to 5.9 percent and the civilian labor participation rate remained relatively stable at 62.7 percent.

Source: National Retail Federation

Online Labor Demand Falls 137,200 In September

October 1, 2014

• September posts a decline, following strong August gain.
• The STEM related categories continue to gain while other occupational groups show losses.

Online advertised vacancies declined 137,200 to 5,072,000 in September, according to The Conference Board Help Wanted OnLine (HWOL) Data Series released today.  The August Supply/Demand rate stands at 1.84 unemployed for each advertised vacancy with a total of 4.4 million more workers than the number of advertised vacancies.  The number of unemployed was 9.6 million in August.

"The September loss offsets most of August's gain, resulting in only modest overall growth for 2014," said Gad Levanon, Director of Macroeconomics and Labor Markets at The Conference Board.  "Following a strong second quarter, the third quarter has ended basically flat."

In September, the STEM-related occupations showed strength in Computer and Math (9,600), Architecture and Engineering (3,400), and Healthcare Practitioners (12,200), while other categories showed losses, including Office and Administrative (-40,600), Sales (-32,500), and Transportation (-22,900).

Regional And State Highlights

• All 20 of the largest states posted declines in September.
• Among the 50 states, 45 experienced losses while 5 (Iowa, Utah, Maine, Alaska and Nebraska) gained.

Metro Area Highlights

• In September, among the 20 largest metro areas, 2 (San Jose and San Francisco) gained and 18 declined.
• Of the 52 metro areas for which Help Wanted OnLine provides monthly data, 8 gained advertisements, 43 lost, and 1 (Rochester) remained constant.

Occupational Highlights

• In September, of the 10 largest online job categories, 3 posted gains and 7 posted declines.

Source: The Conference Board