Saturday, October 22, 2011

August 2011 Employment Report:

The employment report issued yesterday show the economy losing about 87k jobs in August:


That’s ok, because according to the report, 75k people left the labour force at the same time. It should be understood that we’re looking at a pretty strong seasonal effect here, due to Ramadhan – the same pattern consistently repeats over the past 2 years that we have data for.

The upshot is an unemployment rate that didn’t change much:


Taking another look at the data, I’m beginning to think that the big jump we saw in the labour force numbers could be due to the Census, which was carried out in late 2010 (total labour force + outside labour force):


Or quite possibly the amnesty granted to illegal workers at around the same time. It’s a rather striking jump of nearly 750k workers, and the relative smoothness around the break point suggest a one time addition. The number is certainly larger than would be possible than if it was from secondary and university graduates entering the job market. Just as important, the addition was nearly equivalent for both the overall labour force and employed workers.

We’ll get a better idea when the September numbers come out, as the recent amnesty exercise could potentially add a lot more – they’re estimating that there were another 2 million illegal workers in the country. That would add significantly to the labour totals, and give us a better idea of the true labour situation in the country.

Technical Notes:

August 2011 Employment Report from the Department of Statistics (warning: pdf link)

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