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The Hidden Message In Friday's Unemployment Number
Alfred Tella, Real Clear Markets The weak showing in May nonfarm payroll jobs — up 69,000 — failed to pass the Bureau of Labor Statistics (BLS) test of statistical significance and so in technical parlance the change was not different from zero. The May 0.1 uptick in the unemployment rate to 8.2 percent also flunked the significance test as did the recorded rise in civilian employment from the government's household survey. Ditto for the change in payroll jobs in April, originally reported at a statistically significant plus 115,000 but subsequently revised to plus 77,000, falling below the significance threshold. The monthly change in one key labor market indicator, however, did pass the significance test — the labor force participation rate. It rose 0.2 in May, from 63.6 to 63.8 as men, women, and teenagers entered the work force. Had the participation rate not risen last month, the unemployment rate would have fallen to 7.9 percent. Read More