Jobs Report Results

July Jobs Report:

The economy added 163,000 jobs in July, better than the estimated 100,000 that was expected. The unemployment rate moved up to 8.3%, slightly higher than the 8.2% from last month.

The June report was reveised to +64,000 from the +80,000 that was originally reported.

Some other interesting date:

150,000 people left the work force which dropped the participation rate, those who are counted in the unemployment rate calculation, to 195,000.

The U6 number, the actual unemployment rate that includes those who left the workforce, ticked up from 14.9% to 15.0%.

The reason these numbers seem to contradict each other is because the two figures come from separate reports. The number of jobs added (163,000) comes from a survey of business, while the unemployment rate comes from a survey of households.

 

[clester]

Tom, what were the stats about a surprise of 50,000 jobs. The initial reaction reversed? You used to post that.

 

[tsptalk]

From an old post I found from 2005...

Three days after a large surprise in the jobs report of 50,000 jobs, up or down, the S&P 500 was higher only 5 out of 18 times. Its average return was minus 0.5%. Markets don’t like surprises because they create uncertainty.

Ten days after a negative surprise of 50K jobs or more, the S&P was higher 55% of the time. Ten days after a positive surprise of 50K or more, it was lower 58% of the time.

Ninety days after a large negative surprise, the S&P showed an average return of +5.1%. Ninety days after a large positive surprise, its average return was 1.7%.

The correlation between surprises in the jobs number and 90-day returns in the S&P 500 has been -.32. This means that the more positive the surprise, the more negative the performance in the S&P and vice-versa. Given the sample size, this is significant.

http://www.tsptalk.com/mb/tsp-talks...erfund-transfer-6-02-6-03-05-a.html#post20871