September Jobs Growth Numbers Slow

Oct. 6, 2006 — -- The Bureau of Labor Statistics says that employers added just 51,000 new workers to their payrolls in September.

That's the lowest level since the October 2005 post-Katrina report and well below the 125,000 consensus estimate of economists.

Today's report is an interesting one, showing what could be seen as signs of a faltering economy.

Jumping to that conclusion would be wrong, however, according to economists who have been digging into the numbers.

What is interesting to economists is the additional 62,000 jobs that the BLS found in revisions to the previous three months.

Add those to the September results, and we've got a number (+113,000) that's in the range of what most people were expecting.

The nation's unemployment rate -- the result of a different, but simultaneously released survey -- showed a slight improvement during September, ticking down one-tenth of a percent to 4.6 percent.

Realistically, this is nothing more than a statistically insignificant wobble in the number.

So what does the report mean for the economy overall? Despite the really bad headline number, the revisions upward in previous months tend to show that we're in an OK jobs position -- not good, but not bad either.

"This report doesn't really tell us that much about the economy other than the fact that BLS is having problems getting their job numbers straight," said economist Joel Naroff in a postrelease memo.

Naroff is referring to the chatter on Wall Street about a footnote in the morning's report that says that the BLS is going to make a big upward revision in its annual "benchmarking" revision.

Normally, the BLS sees its annual resets increase or decrease the overall population of "nonfarms payroll" by 0.2 percent.

This year's estimate of the reset is something like 0.6 percent, which could mean up 800,000 jobs.

It's a big move that's got many traders wondering whether the jobs report with all its revisions is worthy of being a centerpiece of economic reporting.