The following commentary on the jobs data was previously posted to Ed Dolan's Econ Blog at Economonitor.com
Strong Job Growth and Upward Revisions Contrast Sharply with Reported GDP Decrease
Wednesday’s data release from the Bureau of Economic Analysis surprised us with a reported decrease of 0.1 percent in GDP for Q4 2012. Now, just two days later, a report from the Bureau of Labor Statistics shows robust job growth throughout the last quarter and continuing into January. The two offer sharply contrasting indications of the strength of the economy in the last three months of the year.
The payroll jobs data from the survey of business establishments are subject to both monthly and annual revisions. Monthly revisions reflect the fact that when the numbers are first released, early in the following month, not all firms have submitted their payroll information. As more firms report in, data for the previous month and the month before that are revised. In addition, the data are subject to an annual benchmarking process based on unemployment insurance records. The BLS releases data based on the new benchmarks each January, including revisions of monthly jobs figures for the entire previous year. The following chart shows both the previously reported and the revised data. For all of 2012, the economy added 2,170,000 nonfarm payroll jobs, 324,000 more than previously reported. The revised job gain for Q4 was 603,000. That was more than the quarterly average for the year and 150,000 higher than previously reported. In short, the payroll jobs numbers suggest that the economy was strengthening, not weakening, in the last quarter. >>>Read the full commentary
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