Economics for your Classroom fromEd Dolan’s Econ Blog

Fourth Quarter off to Good Start with Strong Job Gains, Unemployment at New Low

Nov. 8, 2014

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Payroll Jobs Continue Strong Gains

The economy added 214,000 payroll jobs in October, the ninth straight month in which the economy added 200,000 or more jobs

August and September job gains were revised upward by a total of 31,000

Nov. 8, 2014 Ed Dolan’s Econ Blog

Yearly Job Gains Strongest in Eight Years

Total payroll job growth over the past year was over 2.6 million, a rate first reached in September

The last time annual job growth was that strong was back in 2006, during the peak months of the pre-recession boom

Nov. 8, 2014 Ed Dolan’s Econ Blog

Unemployment Rate Falls to New Low of 5.8 Percent

The US unemployment rate fell to 5.8 percent in October, a new low for the recovery.

The unemployment rate is the ratio of unemployed persons to the labor force. The labor force grew by 416,000 for the month. The number of employed persons grew by 683,000, while the number of unemployed fell by 267,000

These numbers are based on a household survey that, unlike the separate survey of payroll jobs, includes farm workers and the self-employed

Nov. 8, 2014 Ed Dolan’s Econ Blog

Broad vs. Standard Unemployment Rate

The BLS also provides a broader measure of job-market stress, U-6

The numerator of U-6 includes Unemployed persons Marginally attached persons who

would like to work but are not looking because they think there are no jobs, or for personal reasons

Part-time workers who would prefer full-time work but can’t find it

The denominator includes the labor force plus the marginally attached

U-6 fell to 11.5 percent in October, also a new low for the recovery

Nov. 8, 2014 Ed Dolan’s Econ Blog

Involuntary Part-Time Work Falls

The percentage of the labor force working part time for economic reasons (involuntary part-time work) decreased in October, continuing its general downward trend

Involuntary part-time work remains high by historical standards

Nov. 8, 2014 Ed Dolan’s Econ Blog

Long-term Unemployment Rises Slightly

The recession and slow recovery have been characterized by unusually high levels of long-term unemployment

The percentage of all unemployed workers who were out of a job for 27 weeks or longer rose slightly in October for the second month in a row

Both the mean and median duration of unemployment rose slightly

Nov. 8, 2014 Ed Dolan’s Econ Blog

The Bottom Line: Prospects Look Good for Q4

The strong jobs report for October was the first major indication of the state of the economy for the fourth quarter of 2014

Following a previous report that showed 2.5 percent growth of GDP in the third quarter, the jobs data bode well for continued growth during the remainder of the year

Nov. 8, 2014 Ed Dolan’s Econ Blog

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