The "trend extrapolations" which are presented here are not forecasts by ShadowStats but rather mathematical trends in the BLS seasonal-adjustment process which we have replicated.  (Please see our full explanation of BLS Payroll Seasonal-Adjustment.)

We believe these data help put into context the significance of the reported monthly numbers. The trend extrapolation also seems to be highly correlated with the consensus views of economists.  We hope that those of our readers who follow the Payroll Survey will find it of interest.

Note:  The trend extrapolation numbers for the forthcoming May survey (to be published on June 1st) were calculated by ShadowStats on May 4th, upon the release of the BLS April survey, and published them in Commentary No. 435 of the same date. These calculations made use of no information other than that provided by the BLS for that survey release.

The trend data for June will be calculated immediately after the release of the May BLS Payroll Survey on June 1st, and will be published same day to SGS Newsletter subscribers in the planned Commentary No.442.

May Trend Extrapolations

• Total Non-Farm Trend extrapolates an increase of 168,000 jobs (seasonally-adjusted) in May 2012. MarketWatch.com’s Consensus of economists’ estimates calls for a gain of 170,000.
• Total Non-Farm Private extrapolation is for an increase of 194,000 jobs.

The charts and table below show a breakdown of monthly changes in seasonally-adjusted job numbers, expressed in thousands.

The monthly consensus number for the Total Non-Farm payrolls growth obtained by MarketWatch.com from selected economists, settled on 165,000 for April. The trend called for 152,000. Actual reported change was 115,000.

 Review of April Trend Extrapolations against Actual Reported Numbers

The Trend Extrapolation numbers presented below were produced from the March 2012 Payroll Survey.

Note: Thin lines show trend extrapolations derived from prior two releases.

Manufacturing: Transportation Equipment. Gained only 3,000 jobs, compared with the trend forecast of 10,000. This industry had seen relatively strong growth in March. Trend forecast for May is again for a gain of 10,000 jobs.

Note: This chart shows the not-seasonally adjusted numbers.

Trade, Transportation & Utilities: Transit and ground passenger transportation.  Lost 11,000 jobs compared with a forecast of no change. The usual seasonal pattern of this series has changed markedly this winter/spring: The usual sharp drop-off in January unadjusted job levels was minimal; The usual strong up-turn in April was replaced by a sharp drop. May forecast is for a snap back giving a seasonally adjusted growth of 5,000 jobs.

Trade, Transportation & Utilities: General merchandise stores. Following a spike in January, this series suffered a huge reversal in February and March. The trend extrapolation was calling for a deceleration in the reversal in April with forecast leveling-off with no change. In fact the series snapped back with a gain of 21,000.  May forecast is again for little change – and this looks reasonable given that on an unadjusted basis we are back to the long-term trend after recent gyrations – again perhaps a warm-winter phenomenon.

Professional and Business Services. This whole sector grew by 14,000 above the trend estimate for April (62,000 vs 48,000). Above-trend gains were made across several sub-series within the sector, with the largest being a 6,000 above-trend gain in Employment Services (temp agency employees).

Health Care and Social Assistance (mainly Hospitals and Nursing Homes) grew by only 18,000 jobs compared to trend forecast of 30,000 for April. There had been somewhat of a surge in reported hiring in February in this sector, and Apri was perhaps a reversion to the mean.  May forecast trend is for a gain of 33,000.