February 2011 Jobs Report and Wages

Here are the job market and compensation numbers for February 2011 (based on the job report):


Net gain
of 192,000 jobs in the month
(Revised in March to a gain of 194,000)

  • Analysts expected an overall gain of 190,000
  • Private sector payrolls increased by 220,000
    • Private service producing industries added 152,000
    • Goods producing industries gained 70,000


  • December was revised to a gain of 152,000 from a revision of 121,000 and an original reading of 103,000
  • January was revised to a gain of 68,000 from a revision of 63,000 and an original reading of 36,000 gain
  • Payroll processor ADP reported an employment gain of 217,000 jobs
    • 46% of the 217,000 came from small business (firms with less than 50 employees)


  • 6.0 million people have been jobless for more than 6 months (long term
    unemployed) – down from 6.2 million last month
    and 6.4 two months ago

    • 43.9% of the unemployed are long term unemployed – up from 43.8% last month (the overall population count has changed resulting in one number improving positively, but another appearing to be negative compared to last month)
  • Employers
    announced plans to cut 50,702 jobs in February, a subdued number but a year over year increase (42,090 in Feb 2010)

Unemployment rate dropped to 8.9%

  • Analysts predicted it would rise to 9.1%
  • The unemployment rate dipped below 9.0% for the first time 21 months
  • Last month there was an oddity of a low increase in jobs but a large drop in unemployment rate. After further inspection this is the result of an unusual squeeze of the components to this equation Number of people in the workforce (civilian labor force) – number of people with jobs (employed) = number of unemployed people.
    • The civilian labor force shrunk a little more than a normal drop with people dropping out of the labor force and the number of people with jobs increased a touch resulting in a significant drop in the unemployment rate
    • The “Not in Labor Force” number rose by 2.4 million people from February 2010 to February 2011

  • The labor force
    participation rate is 64.2% (66.5% is average to good) – unchanged
  • The employment to population ratio is 58.4% – unchanged
  • The
    U-6
    report, which is a broader group to count (workers who are part
    time but want to be full time and discouraged worker), dropped to 15.9% from 16.1%.
  • PMI,
    a measure of manufacturing pace, is 61.4% and the 21th consecutive
    month of readings over 50 percent. Anything above 50% means the
    machines are running
  • Service
    sector activity rose to 59.7%, up from 59.4% last month. It was the
    15th straight month of growth

Specific Segment Job numbers:

  • Manufacturing gained 33,000 jobs
  • Construction gained 33,000 jobs (lost 32,000 so an even start to the year)
  • Retailers lost 8,100 jobs
  • Leisure and Hospitality Services gained 21,000 jobs
  • Government sector lost 30,000, all state or local
  • Education and Health Services grew by 40,000 jobs
    • Health Care and Social Assistance grew by 36,200

  • Professional and Business Services grew by 47,000
    • 15,500 jobs gained in Temporary Help (lost jobs last month after several months of gains)

Wage (can be revised):

  • The average weekly paycheck (seasonally adjusted) is $647.56 – an increase of $1.94 and a $3.35 positive change from December, 2010. $19.08 gain in the last year (there’s been low inflation so this is good)
  • The average hourly earning (seasonally adjusted) is $19.33 – flat from last month
  • Average
    weekly hours and overtime of production and nonsupervisory employees on
    private nonfarm payrolls by industry sector, seasonally adjusted is
    33.5 hours, up slightly from 33.4

Bureau of Labor Statistics

January 2011 Jobs Report and Wages

Here are the job market and compensation numbers for January 2011 (based on the job report):


Net gain
of 36,000 jobs in the month
(revised in March to a gain of 68,000)

  • Analysts expected an overall gain of 149,000
  • Private sector payrolls increased by 50,000
    • Private service producing industries added 32,000
    • Goods producing industries gained 18,000


  • December was revised to a gain of 152,000 from a revision of 121,000 and from an original reading of 103,000
  • November was revised to a gain of 93,000 from a revised reading of 71,000 and an original reading of 39,000 gain
  • October was revised to a gain of 171,000 from a second revision of 210,000 a revised reading of 172,000 and an original reading of 151,000
  • Payroll processor ADP reported an employment gain of 187,000 jobs (a revised 247,000 jobs in December, 2010)
    • The ADP survey and the Jobs Report survey aren’t usually this varying in their results, which, coupled with other data, makes people think the economy is shifting and the models used in the Government report are not currently effective

  • The Labor Department estimates there were 886,000 workers who had a job but couldn’t get to work due to weather (5th largest account of this situation) – if true, this means the real gain in jobs is estimated to be 200,000
  • 6.2 million people have been jobless for more than 6 months (long term
    unemployed) – down from 6.4 million last month

    • 43.8% of the unemployed are long term unemployed – down from 44.3% last month and up from 41.9% in November, 2010
  • Employers announced plans to cut 38,519 jobs in January, a 20% increase over December, according to outplacement consulting firm Challenger, Gray & Christmas. This is a really low number because it usually averages just over 100,000 for the month of January every year
  • Benchmark revisions were made for April 2009 to March of 2010 and show combined additional loss of 215,000 jobs during that period
  • Overall, it was a  confusing report – the numbers seem to contradict each other

Unemployment rate dropped to 9.0%

  • Analysts predicted it would rise to 9.5%
  • The 0.8% drop in a span of two months is rare: only 4 larger two month declines on record and those were in the 1940s and 1950s
  • The unemployment rate has been at 9% or higher for 21 months
  • Normally, when a decrease in the unemployment number happens without a very large number of new jobs it means people have dropped out of the count, but that isn’t the case this month – this is odd (504,000 people did drop out though)
  • The labor force
    participation rate is 64.2% (66.5% is average to good) – relatively unchanged
  • The employment to population ratio is 58.4% – relatively unchanged from 58.3% last month
  • The
    U-6
    report, which is a broader group to count (workers who are part
    time but want to be full time and discouraged worker), dropped to 16.1% from 16.7%.
    This reflects an even greater decrease seen in the overall unemployment rate (9.0% from 9.4%)
  • PMI,
    a measure of manufacturing pace, is 57% and the 20th consecutive
    month of readings over 50 percent. Anything above 50% means the
    machines are running
  • Service sector activity rose to 59.4%, up from 57.1% last month. It was the 14th straight month of growth and the highest reading since August 2005
  • 2010 fourth quarter productivity is reported at 2.6% and annualized at 3.6%

Specific Segment Job numbers:

  • Manufacturing gained 49,000 jobs
  • Construction lost 32,000 jobs
  • Retailers gained 27,500 jobs
  • Leisure and Hospitality Services lost 3,000 jobs
  • Government sector lost 14,000, Federal lost 2,000
  • Education and Health Services grew by 13,000 jobs
    • Health Care and Social Assistance grew by 12,900

  • Professional and Business Services grew by 31,000
    • 11,400 jobs lost in Temporary Help (had been gaining for several months)

Wage (can be revised):

  • The average weekly paycheck (seasonally adjusted) is $645.96 – an increase of $1.42
  • The average hourly earning (seasonally adjusted) is $19.34
  • Average
    weekly hours and overtime of production and nonsupervisory employees on
    private nonfarm payrolls by industry sector, seasonally adjusted is
    33.4 hours

Bureau of Labor Statistics

Job Report Stats Summary

The Train with No Known Destination

Last week news broke of Eric Schmidt leaving the CEO post at Google. He’s replaced by Larry Page. Speculation is that Schmidt no longer felt he was in control of the company. The triumvirate of Sergey Brin, Larry Page, and Eric Schmidt had become a duopoly of Brin and Page, the founders. The genesis of their relationship is rooted in the need for someone who knew how to run a big company – Schmidt. Around 2000 when Google was  preparing to go public it was growing at an immense rate. The size of the company had surpassed the experience level of 20 somethings. The founders would concentrate on a start up atmosphere of constant disruption. Disruption is where money is made.

At some point, every successful company grows out of it’s novelty state. The disruption becomes the norm. Competitors look for weakness and stagnant ideas. Being a perpetual start up is the dream of people like Brin and Page. But how do you do it?

Intelligent continual employee turnover.

The enterprise must become a train with no known destination, just stops letting people get on and get off. When the enterprise becomes “the destination” then protection ensues. People can be very good at their jobs, but if they are doing the same thing for more than three years then you have to wonder why? Why isn’t the job evolving? Why isn’t it automated? Why is it needed?

Many large companies, including Google, want to be smaller. Being nimble is key. But wanting a start up mentality and structurally building it in to the culture is not the same. There are a lot of tough conversations to be had. For instance, Netflix has a running practice of “adequate performance gets a generous severance package” and they apply a keeper test which is pretty simple: which people would you fight to keep, at any cost, if they told you they were leaving in two months? This is supplemented by honest conversations about the employee’s commitment and ability to deliver. No surprises.

The NY Times in their weekly section called The Corner Office interviewed Jeremy Allaire, chairman and chief executive of Brightcove. He talked about his conversations with his work force. He said he asks them “What are you trying to do? Where are you trying to head?” This survey reinforces the need to be ever improving.

When the culture of the company is to evolve the job, to morph it, to leave it, or to destroy it (automate) then, as an employee, you know when it’s time for a change. Just ask Google.

Tracking Employment News

14 million people are without jobs. Imagine everyone in NYC, Chicago,
Philadelphia, and Dallas without a job. That’s almost 14 million. I
mention this because the tone of the news regarding employment has
improved since the beginning of fall 2010. It’s almost like we’ve been
on this long road trip and we can finally see the skyscrapers in the
distance. There’s miles to go, but hope is in sight.

I mentioned a few posts ago about the value of the A employee.
I said they are changing the dynamics of the job market and I praised
them. But I can’t pin them down. Sometimes they are the 35 year veteran
and other times they are the 35 year old hitting their stride. Youth
often prevails and so does being a woman. You just never know.

Anne Fisher over to Fortune.com highlighted a great resource for seeing who’s hiring called A Real-Time Look at Who’s Hiring and Where. Vault.com has a tool called Vault Employment Tracker. It’s a simple database organizing all the job announcements.

Date http://www.vault.com/images/icons/desc-arrow.png

Company 

Layoffs 

Hires 

Notes

Industry 

Info

01/18/11

AM General

300

0

AM will layoff 300 workers after the military reduced its order for Humvees.

Manufacturing

More

01/18/11

Unified Solutions Inc

228

0

Manufacturing – Other

More

01/18/11

Karachi Electric Supply Company (KESC)

4000

0

The layoffs are part of a cost-cutting drive to make the power utility financially viable, sources said on Friday.

Energy

More

01/18/11

Johnson Controls Inc.

0

250

The auto parts planct broke ground on its battery recycling plant in Florence, S.C.; it’s set to be finished next year.

Manufacturing – Other

More

01/18/11

Sam’s Club

0

170

The company is looking to hire every position from cashiers to supervisorsat its new location on  in Riverview, FL.

Department Stores

More

01/14/11

Berkeley College

150

0

Affected employees–non-faculty-members–will be let go by June.

College and University Education

More

01/14/11

Lockheed Martin Corporation

1000

0

LM, which is closing its Eagan plant in 2013 is cutting 250 jobs altogether, down from the original 350 anticipated.

Aerospace and Defense

More

01/14/11

Public Health-Seattle and King County

123

0

Nurses, social workers and other staffers were let go as a result of a 50% budget cut to an aid program for low-income pregant women and babies.

Insurance

More

01/14/11

Sterling Life Insurance

80

0

Sterling is adjusting to reduction of enrollment in one of its key products.

Health Insurance

More

01/14/11

SoloPower

0

170

SoloPower said Thursday that it is opening up a new, solar panel manufacturing facility in Oregon

Manufacturing

More

November 2010 Jobs Report and Wages

Here are the job market and compensation numbers for November 2010 (based on the job report):


Net gain
of 39,000 jobs in the month

  • Private sector payrolls increased by 50,000
    • Down from 160,000 last month
    • Worst performance in 10 months

  • Analysts expected an overall gain of 150,000
  • September was revised to a loss of 24,000 jobs from an original reading of 95,000 lost and a revised loss of 41,000
  • October was revised to a gain of 172,000 from an original reading of 151,000
  • The revisions for August, September, and October added 145,000 jobs to the economy
  • 6.1
    million people have been jobless for more than 6 months (long term
    unemployed) – virtually unchanged from August, September, and October

    • 41.9% of the unemployed are long term unemployed – inched up from 41.8% last month and 41.7% the month before
  • The main type of hire was for Temporary Help Service (+40,000) and since September of 2009 this employment has improved by 494,000
    • Its normally an indicator of an improving economic cycle, but a year of it indicates uncertain business conditions

  • Job Openings and Labor Turnover Survey (JOLTS), shows that job openings increased by 351,000 in October
  • The total number of job openings in October was 3.4 million, while the total number of unemployed workers was 14.8 million
  • The ratio of unemployed workers to job openings improved to 4.4-to-1 in October

Unemployment rate went up to 9.8%

  • Analysts predicted it would be 9.6%
  • The unemployment rate has been over 9% for 19 months – the longest such streak since the early ’80s
  • The employment to population ratio is 58.2% – relatively unchanged
  • The
    U-6 report, which is a broader group to count (workers who are part
    time but want to be full time and discouraged worker), stayed at 17.0%. This indicates the increase of the unemployment rate to 9.8% is a reflection of more people actively looking for jobs in November (these individuals are only counted if they are actively looking)
  • The unemployment rate for those with a college education is 5.1%
    • Highest in 40 years

  • PMI,
    a measure of manufacturing pace, is 56.6% and the 19th consecutive
    month of readings over 50 percent. Anything above 50% means the
    machines are running
  • Productivity, measured for the quarter, showed tepid growth of 2.3%

Specific Segment Job numbers:

  • Manufacturing lost 13,000 jobs
  • Construction lost 5,000 jobs
  • Retailers lost 28,100 jobs
  • Leisure and Hospitality Services gained 11,000 jobs
  • Government sector lost 11,000, Federal gained 2,000
  • Education and Health Services grew by 30,000 jobs
    • Health Care and Social Assistance grew by 34,000

  • Professional and Business Services grew by 53,000
    • 39.500 jobs added in Temporary Help

Wage (can be revised):

  • The average weekly paycheck (seasonally adjusted) is $642.87 – a decrease of $1.91
  • The average hourly earning (seasonally adjusted) is $19.19
  • Average
    weekly hours and overtime of production and nonsupervisory employees on
    private nonfarm payrolls by industry sector, seasonally adjusted is
    33.5 hours

Bureau of Labor Statistics

Job Report Stats Summary

Scared of Ideas or Open to Change?

He hears the alarm clock, hits snooze, and lays there for ten minutes somewhere between sleep and awake. “In the Hall of the Mountain King” by Edvard Grieg plays:

He does what I think is one of the hardest things in the world to do, he puts the first foot on the floor in the morning. He goes to the bathroom, runs the shower, and peers into the mirror. Everyday its the same. Same time, same song, same struggle. Everyday.

Routines are good for many aspects of our lives. We need to focus on what is different in our environment and routines keep us safe to do so. But the comfort of a routine can be disabling as well. For instance, there’s a field of study called Terror Management Theory and it describes what people do to repress an awareness of mortality. Here’s an excerpt from HarvardBusinessReview.com called Employees See Death When You Change Their Routines which enumerates three means for warding off these thoughts:

Studies show that we create three existential buffers to protect us from this knowledge: Consistency allows us to see the world as orderly, predictable, familiar, and safe. Standards of justice allow us to establish and enforce a code of what’s good and fair. Culture imbues us with the sense that we have contributed to, and are participating in, a larger and enduring system of beliefs.

As a manager it’s important to know which of your employees are lulled into this perceived safe zone and will need some coaxing when change is on the horizon. They’ll want to hold onto the way things are – they’re good at them, they understand what’s expected, and they are familiar – but it’s counterproductive. You’ll need to invest in re-establishing these buffers for them…

Unless they are risk takers. Many entrepreneurs don’t like routines. They want constant change with a little bit of chaos mixed in. Companies like Google seek them out because they tend to be disruptors and a disruption can be a money maker. Just last week the NY Times ran an article about how Google gave 10% raises across the board. Google’s growth has brought with it the bureaucracy of a big company. Some entrepreneurs are fleeing the company. The reason is because they can’t affect change quick enough. Their supply of patience is sapped.

Both types of worker, the comfort in routine and the risk taker, must answer this question posed by Bob Brennan of Iron Mountain to this employees:

What do you recommend we do?

You can get a real sense for who’s invested in moving the company forward, and who’s watching the company go by, with that very simple question.

Q. Why?

A. People lay out problems all the time. If they’ve thought through what should be done from here, then you’ve got somebody who’s in the game, who wants to move, and you can unlock that potential. Bystander apathy or the power of observation, in and of itself, is not very valuable. There are amazingly eloquent diagnosticians throughout the business world. They can break down a problem and say, “Here’s your problem.” But it’s prescriptions that matter. So how do we move from here, and what specifically do you recommend?

Working Thoughts 11/29/07
It’s Not a Recession but it Sure Feels like It

Working Thoughts 11/29/08
There Are Jobs for Low Level Employees?

Private Sector Jobs: A Lagging Indicator Showing 10 Months of Improvement

The last Jobs Report was all-in-all a very positive report. The numbers that came in blew away expectations and the revisions for the past two months also significantly improved those figures. Here is a chart showing the last 22 months. We have a long way to go, but growth, slow as it is, is ahead. If I’m the head of HR, I’m gearing up for a competitive 2011 – jobs are a lagging indicator for the economy.

Notes on the chart:

  • Beginning in November of 2009, two years after the recession began, the jobs report starts to smooth out
  • The Government numbers in 2010 are a roller coaster due to the temporary nature of census work (once a decade)
  • Private sector hiring has slowly improved throughout the year (2010)
  • The 2009 figures are historically bad. The normal top and low range for jobs is between a gain of 250,000 and a loss of 250,000.

Working Thoughts 11/10/08
Cultivating a Business Network

Working Thoughts 11/10/09
Unemployment Graphs and Charts – October 2009

October 2010 Jobs Report and Wages

Here are the job market and compensation numbers for October 2010 (based on the job report):


Net gain
of 151,000 jobs in the month

  • Census work, which elevated the jobs report in the spring and then weighed it down over the summer is no longer a factor
  • Private sector payrolls increased by 159,000
    • Four straight months of private payroll gains surpassing 100,000. Hasn’t happened since October 2005 – April 2006

  • Analysts expected an overall gain of 60,000
  • August was revised to a loss of 1,000 from an original reading of a loss of 54,000 and a revision of 57,000 last month
  • September was revised to a loss of 41,000 jobs from an original reading of 95,000 lost jobs
  • The revisions for August and September alone add 110,000 jobs to the economy
  • 6.1 million people have been jobless for more than 6 months (long term unemployed) – virtually unchanged from September and August

    • 41.8% of the unemployed are long term unemployed – inched up from 41.7% last month
  • Businesses (private sector) have now added 1.1 million jobs since the start of 2010, after cutting 8.5 million in 2008 and 2009 combined
    • 1% Gain over the last 12 month. The first time this has happened since mid 2007, prior to the recession

  • Government has lost 253,000 jobs

Unemployment rate stayed at 9.6%

  • Analysts predicted it would be 9.6%
  • The employment to population ratio is 58.3% – down from 58.5%
  • The U-6 report, which is a broader group to count (workers who are part time but want to be full time and discouraged worker), decreased slightly to 17.0% from 17.1%. This is still really high
  • PMI, a measure of manufacturing pace, is 56.9% and the 18th consecutive month of readings over 50 percent. Anything above 50% means the machines are running
    • There are now 0.8% more manufacturing jobs than there were a year ago. Manufacturing has been a slow decline for a decade

  • Productivity, measured for the quarter, showed tepid growth of 1.9%

Specific Segment Job numbers:

  • Manufacturing lost 7,000 jobs
  • Construction gained 5,000 jobs
  • Retailers added 27,900 jobs
  • Leisure and Hospitality Services lost 5,000 jobs
  • Government sector lost 8,000, Federal losses were 1,000
  • Education and Health Services grew by 53,000 jobs
    • Health Care and Social Assistance grew by 34,000

  • Professional and Business Services grew by 46,000
    • 34.900 jobs added in Temporary Help

Wage (can be revised):

  • The average weekly paycheck (seasonally adjusted) is $644.11 – an increase of $4.26!
  • The average hourly earning (seasonally adjusted) is $19.17 – an increase of 7 cents
  • Average weekly hours and overtime of production and nonsupervisory employees on private nonfarm payrolls by industry sector, seasonally adjusted is 33.6 hours

Bureau of Labor Statistics

Job Report Stats Summary

The Next 30 Years: Smaller

An election just passed and the results indicate a very unsatisfied voter. It makes perfect sense. Middle class jobs are scarce and wealth is gravitating only to the uber-rich. We’ve had a thirty year mirage in the standards of living.

Thirty years is a time period I key in on. President Ronald Reagan made thirty year policy decisions and we are at the dawn of a new thirty year window. Besides the politics of it, the transition of leadership throughout companies and communities is just now beginning. Those in their 30s and early 40s are set to grab leadership positions within the next three years.

This is a very positive development.

The values of those ending their leadership position are different from those set to attain it. For instance, the sense of privacy for a 25 year old is nothing like it is for a 60 year old. Sharing on facebook, twitter, and on blogs means you are comfortable with potential embarrassment. There is no hiding skeletons in the closet anymore.

But the main value I see differentiating the two groups is one of scale of competition. The older guard wants to amass competitive advantages and really leverage economies of scale. But the younger guard wants to go smaller. Manufacturing shaped the economics of the 20th century, but a knowledge economy is shaping the present day. Concepts like Design and Branding are ever more important. And perception plays a part in how they are valued. Perception isn’t a Deming TQM or Six Sigma concern.

Bigger versus smaller separates the path. Bigger wants to protect the status quo – scale is expensive. Smaller wants nimbleness but with standards. Think Microsoft with the Office Suite versus Apple’s App Store. Microsoft has a cash cow with Windows and they leverage it to sell Office. People are familiar with it and it works. But how much has it really changed over the last 10 years? Not much, but people keep buying it. Now think about Apple with the App Store. They developed a platform for small developer shops and large ones to compete on an even field. Apple manages the standards and sets up the merchant services. The developers can leverage the scale Apple already built with the platform and sell. Compatibility and interoperability aren’t deal breakers either. This simplifies the cost to compete. Ideas sink or swim based on their merit and marketing.

As we embark on the next thirty years, expect to see a shift in values. It’ll be less of an us and them world and competition will be a loose definition, almost encouraged. Attitudes will change. Smaller is captivating. What do you value?

Working Thoughts 11/4/08
Why Voting Matters

Generational Delay in Leadership

A few entries ago I wrote about a movie called Waiting For Superman. Today I learned that Jeff Skoll is the man behind it. He funds movies with an angle beyond entertainment; his movies inform, potentially leading to social activism. His films include: Good Night, and Good Luck, North Country, Syriana, An Inconvient Truth, Murderball, Fast Food Nation, The Kite Runner, and Charlie Wilson’s War.

He can fund all these movies because he was the first President of eBay. In 2002, he cashed out for a take of $2 Billion. He was 31 years old when he became the lead of the internet auction house. In his 20s he took some entrepreneurial risks, those successes earned him the eBay opportunity and he is credited with forming the business model the company uses.

Fortune.com is running a theme about leaders under the age of 40. They have a 40 Under 40 piece and a 20 Highest Paid Under 40 section going currently. These people are featured because they are leaders. They are changing the world. And they are young.

As much as the 6.2 million long term unemployed are a long term economic problem for the US, the slowing of the ascension of next generation leaders is as well. There are Pew Research Studies showing a delay in independence  in 20 somethings in the US. Here are some stats:

  • In 2010, 85% of college seniors planned to move back home with their parents after graduation.
  • In 2006, 67% of college seniors planned to move back home.
  • In 1970, the age of someone who is not college educated to get married was 22 years old. For the college educated, it was 23 years old.
  • In 2008, the age of someone who is not college educated to get married was 28 years old. Same for college educated.

This is important for a variety of reasons, but the two main ones are: it delays leadership chances and it stunts income potential. A study was performed by Columbia University called Elites Research Network. The point of the work was to understand how, or what, made someone elite financially. The seminal finding was most of the people were put in early career opportunities, the type that makes the person a generalist and not a specialist. This advantage, more than privilege or inheritance, is the key to lasting success.

So what does it mean for the US that 85% of college grads are living at home post graduation? Or that marriage on average is 6 years later than it was in 1970? Is 40 the new 30? And if so, without the compounding interest of 401k or pensions does that mean 75 is the new 65?