Sales lead employment: real aggregate payrolls update – by New Deal democrat The drought in new data ends tomorrow with consumer inflation. In preparation, let’s take a look at real aggregate payrolls. These increased 0.2% in December, one of the lower readings in the past 2 years: On a YoY basis, aggregate nonsupervisory payrolls increased 5.8%, compared with consumer inflation in November, which increased 3.1%: Recall that over the long term, real aggregate payrolls YoY have been an excellent coincident marker of recession: They have typically made a rounded peak roughly 6 months before its onset. With real aggregate payrolls being up over 2.5% in November, and at a new record, the expansion has remained on solid
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NewDealdemocrat considers the following as important: Employment, Hot Topics, January 2024, sales, US EConomics
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Sales lead employment: real aggregate payrolls update
– by New Deal democrat
The drought in new data ends tomorrow with consumer inflation. In preparation, let’s take a look at real aggregate payrolls.
These increased 0.2% in December, one of the lower readings in the past 2 years:
On a YoY basis, aggregate nonsupervisory payrolls increased 5.8%, compared with consumer inflation in November, which increased 3.1%:
Recall that over the long term, real aggregate payrolls YoY have been an excellent coincident marker of recession:
They have typically made a rounded peak roughly 6 months before its onset. With real aggregate payrolls being up over 2.5% in November, and at a new record, the expansion has remained on solid footing.
Yesterday I posted another installment of “consumption leads jobs,” so I decided to take a look comparing real retail sales (blue in the graphs below) with real aggregate payrolls. I’ve split it up into three historical segments for better visibility.
Here is 1965 through 1993:
Here is 1994 through 2019:
And here is the post-pandemic record:
As usual, real retail sales are somewhat noisy, and the relationship is not perfect. But in general, real sales have tended to lead real aggregate payrolls by 1-2 months, especially as a smoothed average. Because of the noise, I don’t think we can use the former to forecast the latter, but because each measure independently has been generally reliable, watching them together will be particularly helpful.
I will update again tomorrow or Friday after the inflation report.
Real aggregate payrolls rise to new high as CPI ex-shelter continues somnolent, Angry Bear, by New Deal democrat.