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Comment by listenallyall | Hacker News Reader

For more confusion, take a look at this morning's BLS May employment report, which is arguably the most influential dataset for financial markets:

Jobs +339,000 (way above even the highest forecast)

but...

Unemployment rate - major increase from 3.4 to 3.7%

Household survey reported 310,000 fewer people employed

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Is this due to the fact that the unemployment rate only considers people as “unemployed” if they are actively looking for work? If more people who were taking a long-term break from the workforce (e.g. stay-at-home parent, retired, “funemployed,” etc.) are trying to jump back into the workforce, the unemployment rate can rise even as the economy adds jobs.

You're thinking labor force particpation rate, also tracked by the BLS. It's more or less returned to within a percent of what it was pre-Covid https://www.bls.gov/charts/employment-situation/civilian-lab...

“Within a percent” is doing some heavy lifting there. The slightest of changes is hundreds of thousands of people.

May 2019: 62.9%

Jan 2020: 63.3%

May 2023: 62.6%

Remember the workforce also lost millions of people to death and disability. The percentage has never recovered from post 2008 range of ~66%.

Still, "within a percent" is misleading in this context. The number is within one percentage point, however, the entire range of the dataset since 1970 has been within 60 to 67%. Therefore, "a percent" difference is 14% of the range. For 2 decades between 1988 and 2008 the entire range was steady between 65.8 and 67.2 or so. The ensuing "great recession" only dropped the rate by about 3 percentage points.

https://fred.stlouisfed.org/series/CIVPART

The difference between a reliable cloud service with 99.9% uptime and one with 99% uptime is also "within a percent" -- but the less reliable service has 10x more interruptions.

That's part of it. As mentioned elsewhere, they do measure the "participation rate," but it was unchanged from April to May.

Here's a pretty good explanation: https://www.investopedia.com/hiring-increased-in-may-so-did-...

Basically the BLS performs two surveys, one of employers (which supplies the job numbers) and one of households (which supplies unemployment rate and number of employed people). Obviously, surveys have margins of errors (which is partly cleaned up via future revisions) and they don't measure the exact same thing. It's not that unusual for them to produce conflicting reports but in this case both numbers -- payrolls and unemployment -- rose much more than all the economists had forecast, right in the middle of a very key period, when the Feb has some very difficult decisions to make regarding interest rates.

If you want to dig deeper, start reading up on the seasonal adjustments and statistical models (specifically, Birth/Death model), there's a lot of ways to break down and to interpret (or re-interpret) the BLS data.

This is one of those fluky months in the household survey. All the negative number in employment can be accounted for by 1) government wage/salary worker and 2) unincorporated self employed. There is pretty obviously some huge error in there, especially 2) down 4.1% MoM. Self employed are not counted in the employer report

In the household report private non farm employment was up 395k. In the employer report private nonfarm payrolls were up 339k

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