As the world waits breathless for some Goldilocks print in tomorrow's non-farm payroll data, Gallup's most recent survey [6] of employment trends does not paint a pretty picture for the real economy. Though, by the 'adjustment bureau' and their Arima-X goal-seeking, nothing is ever clear, not only is the payroll-to-population (the number of people working) worse than a year ago but the unemployment rate is also rising with under-employment - at 18.0% - near 15 month highs. If the NFP print plays out in line with this, the estimate of 165k will be woefully over-optimistic, leaving the question of whether bad-is-good, or have we crossed the Rubicon of belief in moar is better.
Via Gallup: [6]
The U.S. Payroll to Population employment rate (P2P), as measured by Gallup, worsened in May, dropping to 43.9%, from 44.5% in April. P2P is also down from May 2012, when it was 44.4%
The decline in P2P versus 2012 indicates that fewer people worked full-time for an employer this May compared with a year ago. The 43.9% found this May is similar to the 43.7% recorded in 2011 and 44.0% in 2010.
Gallup's P2P metric is an estimate of the percentage of the U.S. adult population aged 18 and older who are employed full time by an employer for at least 30 hours per week. P2P is not seasonally adjusted.
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Gallup's unadjusted unemployment rate for the U.S. workforce was 7.9% for the month of May, a half-point increase over April, and statistically unchanged from May 2012 (8.0%).
Gallup's seasonally adjusted U.S. unemployment rate for May was 8.2%, up from 7.8% in April.
Underemployment, as measured without seasonal adjustment, was 18.0% in May, up from 17.5% in April, but unchanged from May 2012 (18.0%). Gallup's U.S. underemployment rate combines the percentage of adults in the workforce who are unemployed with the percentage of those who are working part time but looking for full-time work.
Implications
The decline in P2P and the increase in unemployment that Gallup finds in May contrasts with the improvements in both seen in April [7]. The strong year-over-year improvements seen in April were not sustained in May, and the size of the workforce, P2P, and unemployment rate are virtually the same as or in worse shape than a year ago.