November’s 71,000 slump in the Labour Force Survey (LFS) measure of employment almost certainly overstates the weakness of the labour market. While we do not yet have the November data for the more reliable Survey of Employment, Payrolls and Hours (SEPH), the alternative ADP figures, which are well correlated with the SEPH, showed a 31,000 rise in employment in November. If that’s matched by the SEPH, it would keep the six-month average gain at a little over 20,000, rather than the very weak six-month average gain of 6,000 shown by the LFS. Although the LFS seems to have overstated the weakness of the labour market in November, we are likely to see a more genuine slowdown in employment growth across the different measures in the coming months. With employment growth slowing to a crawl, we expect the unemployment rate to drift up in the first half of 2020, but it should remain below 6.5%.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services