In the July employment report released by the BLS this morning, August 7, the labor market shows its first encouraging signs. Most commentators will focus on the jobs numbers, which show a decline of less than half the rate that the economy experienced in the “freefall period” of late 2008 and early 2009.
Employment tends to lag behind production. For this reason, as readers of this blog will know, my preferred indicator is total hours worked. The latest numbers show that the length of the workweek has begun to rebound from its record low of two months ago. As a result, the BLS reports that total hours worked in the economy did not decline at all in July, for the first time since the financial meltdown of last September.
One never wants to read too much into a single report, especially one subject to revision. But when today’s labor news is combined with a variety of other data, it looks likely that the economy is finally at or near the turning point.
Hours Worked (Changes) from the Current Employment Statistics survey,
Bureau of Labor Statistics, Aug. 7, 2009
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2007 -0.5 0.0 0.6 -0.3 0.5 0.1 -0.2 -0.1 0.1 0.2 0.2 0.1
2008 -0.3 0.1 -0.1 -0.1 -0.5 -0.5 -0.2 0.2 -0.6 -0.8 -0.9 -0.9
2009 -0.7 -0.6 -1.2 -0.6 -0.3 -0.7(P) 0.0(P)