American Job Bears Should Apologize


Today the Bureau of Labor Statistics reported jobs data for December 2018. Payroll jobs grew at 312,000 which means that the longest job expansion streak continues, now for 99 months.  Job creation in 2018 has beaten my expectations by a lot. This has been one the best job creation years we have had in recent history–especially when one takes into account the duration of this economic expansion and our demographics.  We are now 6 months away from having the longest economic expansion ever recorded in U.S. history.

At the beginning of the year, I anticipated we would create 157,000 jobs per month, at best. For the year, we are pushing an average of 220,000 jobs per month. I don’t believe this rate of job creation can last. However, even if the job creation numbers fall in 2019, don’t mistake that as a bad labor market. 2018, if we are honest with ourselves is the best jobs year in many decades when you take into account all the jobs data.

– Longest job expansion ever, 99 months in a row, previous record 48 months.

– Unemployment claims vs the civilian labor force at the lowest levels ever recorded in U.S. history

– Job openings had a 7,300,000 print in 2018, the highest on record.

In 2017 I wrote:

“For 2018 I am predicting monthly job creation numbers in the 157,000 – 129,000 range, which is still well above population growth, but lower than last year. With over 6,000,000 job openings in play that number should be attainable.”     

From BLS:

Total non farm payroll employment increased by 312,000 in December, and the unemployment rate rose to 3.9 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, food services and drinking places, construction, manufacturing, and retail trade.

This a breakdown of the jobs created for the last month.

From BLS:

jan jobs breakdown

This is a look at the earnings breakdown for the previous month.

From BLS:

jan wage jobs

Wage growth is running at 3.2% on a 12-month average. The 3-month average rose to 3.4% %. This means that real wage growth looks solid, since headline CPI inflation has been falling from the recent highs. Lower oil prices will boost the real average hourly wage data.

Atlanta Fed:
jan wage growth atl fed

From Doug Short:
dec cpi short

Job growth continues to outperform my expectations. We are producing over double the number of jobs needed for population growth. This is a solid reflection of our American work ethic, especially considering the duration of this economic cycle.

Today, the U6 Unemployment Rate is still below the pre-recessions lows.

From Doug Short:
jan u6

2019 Economic & Housing Predictions can be found here:

Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group,  which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data  daily on his own facebook page