Payroll Employment and Household-Survey Unemployment

The household-survey unemployment rate tends to fall when the monthly establishment-survey payroll employment number is more than... it's now 130,000 jobs gained a month, and tends to rise when the monthly establishment-survey payroll employment number is less than 130,000 jobs gained a month.

Figure updated to cover 1981:1 to 2006:7. Datafiles courtesy of http://www.economagic.com

(Since 2000:1, the estimated intercept has risen to 166,000--but is very imprecisely estimated.)

Comments

[knzn]

Wouldn’t it make more sense to use the proportional growth rate of employment (or alternatively, use the change in the number of people unemployed on the y-axis)? As it is, you would expect the intercept to increase over time, since the number of workers represented by a given change in the unemployment rate is increasing.

[spencer]

The household survey also tends to lead the payroll data -- especially at bottoms.

I suspect this is because smaller firms react quicker and this show up in the household survery.

[Jim S]

Actually, spencer, firing people is one area that the large businesses are very fast and "efficient" at.