In mid-2014, we introduced the EMSI Job Forecast, a prediction of the previous month’s change in employment three days before the BLS releases its initial number. The goal of our forecast, which is based on a number of leading labor market indicators and data releases, is to give an early look at the current state of the labor market.
We release the job forecast the Tuesday before every monthly jobs report.
The December Job Forecast: +300K Jobs
November was a big month for non-farm employment gains, the best since January 2012, and EMSI expects the December payroll numbers to be almost equally as strong. Our model shows that employers added 300,000 net jobs in December, an estimate that includes total non-farm payroll employment (government included). This would be the second straight month of at least 300,000 new jobs (November’s preliminary figure was 321,000) and the 10th straight month over 200,000 dating to February.
What’s Behind the Number?
Here are a few factors driving EMSI’s predicted jobs number:
- Real GDP grew 5% in the third quarter, 28% higher than second revision and 43% higher from the advanced estimate.
- Personal income increased in November by 0.4%, twice as high as October’s growth rate, according to the Bureau of Economic Analysis.
- Four-week seasonally adjusted average initial unemployment claims increased around 5,600 from the previous month and slightly decreased from the previous week.
How Have We Performed?
We launched the forecast in August, but we’ve been tracking our model’s performance since we developed it in the summer of 2013. How have we fared?
BLS-EMSI Comparison (In Thousands)
|BLS Initial||BLS Revised||EMSI|
Since July 2013, EMSI’s average error is +/- 42,500 compared to the first BLS release and +/- 43,300 compared to the BLS revised number.
The EMSI Job Forecast is calculated using a time series of leading indicators from federal data sources. Our model includes data on initial job claims from the Department of Labor, various economic indices, and employment data from the Bureau of Labor Statistics. The job forecast covers total non-farm payroll employment in the U.S., including private-sector and government jobs. EMSI’s goal is to predict the BLS’s change in employment in the most accurate way, with an eye toward the preliminary monthly figure and the final number.
Note: Our monthly job forecast methodology is not related in any way to our approach to producing quarterly employment projections by industry and occupation.
Emsi turns labor market data into useful information that helps organizations understand the connection between economies, people, and work. Using sound economic principles and good data, we build user-friendly services that help educational institutions, workforce planners, and regional developers (such as workforce boards, economic development offices, chambers of commerce, and utilities) build a better workforce and improve the economic conditions in their regions.