It’s jobs day in the US and for the 92nd month in a row that means growth.
It’s an impressive streak considering the previous record was just over half that so credit where credit is due. Another data point is the continuation of the long-term trend of the unemployment rate dropping.
Again considering it was nearly 10% at the height of the financial crisis it’s been an uninterrupted decline for over 8 years so again credit to the great turnaround in 2009.
However I can’t help but throw a little cold water on the situation because there are a few reasons to hold off on the celebration. The first is that the job growth streak only measures raw numbers and whether it’s positive or not. It doesn’t take into account the change in that growth, and we’ve actually seen a decline in the last few years since the top in 2014.
It’s definitely growing, but at a slower rate. Of course in a perfect world we’d like to see this stable or increasing. And we also need to add in that the drop in unemployment rate was accompanied by a drop in the labour force participation rate. From 62.8% to 62.7%. It bottomed in 2014, started climbing a little bit but now it’s flat and ticking down again.
Decreasing unemployment is great, but not if it’s due to people leaving the work force so we’ll continue to keep an eye on things.
As you all know I don’t talk about US politics at all other than to mention important developments that directly affect our trading. I’m Canadian (we have our own problems up here north of the border) and I don’t identify with either party in the US. Or more accurately I should say I positively identify and agree with several different aspects of both. My comment today is to encourage others to do the same. My fear is that in this current politically charged environment we are spending too much time bickering about what minuscule differences we see in the economy and who’s responsible for what tiny increases or decreases. We risk missing the forest for the trees. Real work needs to be done to keep this train on the tracks. Cooperation between those in power is the only way to succeed in that. We can only vote once every four years but we can attempt to rectify differences every single day and encourage our leaders to do the same.
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