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There are lots of topics potentially of interest of course. I created my normal batch of charts during very different, happier economic times.
So for the moment, I thought I& #39;d cull down the list and focus on just a handful that are relevant. Suggestions for others welcome. /1
So for the moment, I thought I& #39;d cull down the list and focus on just a handful that are relevant. Suggestions for others welcome. /1
First off, 40 million Americans have seen a major work disruption since February: either losing/leaving their jobs, being put on furlough, or having their hours cut involuntarily.
*Less than half* of these disruptions are accounted for by the rise in the unemployed. /2
*Less than half* of these disruptions are accounted for by the rise in the unemployed. /2
I& #39;ve tried to account for all these extended margins of disruption in a measure I call "NPOP". NPOP is the share of the US population not at work in either a full- or voluntary part-time job. It rose 12.5 percentage points in April alone. /3
The fact that the single largest category of disruption is unemployed on temporary layoff has been a source of comfort for some observers, since ostensibly this is a category with very high labor market attachment: around 50% of layoffs go back into work the next month. But... /4
...unsurprisingly, this time looks like it will be different. Transition rates from layoff back to employment plunged to almost 30% in April alone. /5
It bears reminding that "temporary layoff" is entirely in the eye of the respondent. They may think their layoff will be temporary, but it& #39;s not clear that in the current situation they have a material information advantage. /6
On wages, we saw a huge spike in average hourly earnings in the April jobs report due to compositional effects: since the pandemic is disproportionately hitting low wage workers, the rump average wage soared. /7
The CPS allows us to overcome compositional effect by looking at median wage growth among same-workers employed 12 months apart.
April was a bit soggy when looking at hourly wages, but this is a noisy series and there wasn& #39;t an obvious break in the data /8
April was a bit soggy when looking at hourly wages, but this is a noisy series and there wasn& #39;t an obvious break in the data /8
To account for the possibility that firms are cutting labor costs through fewer hours, I also looked at median *weekly* wage growth. But the qualitative story is not dramatically different. /9
When you compare the hourly and weekly median wage series, it& #39;s not obvious the typical firm is resorting to cuts in hours among *existing* employees yet. /10
I won& #39;t break down wages by industry/occupation, as those are particularly noisy & applying an e.g. 12M moving average is not likely to tell us much meaningful about April alone.
I will note though that the non-raise rate continued to rise, which it& #39;s been doing for a few months
I will note though that the non-raise rate continued to rise, which it& #39;s been doing for a few months
That& #39;s all for now, but more to come in the days and weeks ahead. Let me know your thoughts. /FIN
