While many data watchers eagerly anticipate the monthly jobs report coming out this Friday, today the Bureau of Labor Statistics released another set of jobs data, and arguably a much better and more complete set of jobs data for 2023. It’s called the Quarterly Census of Employment and Wages, and I have written about this data before.
The QCEW data is better because, as the name implies, it is a census of employment, rather than just a survey, meaning it is an attempt to measure the universe of employment (or at least, the universe of employment covered by unemployment insurance, which is something like 95% of the workforce). Surveys are nice, because they can provide us more timely information — notice that the QCEW is 5-6 months out of date. It is also useful to have this complete data to check on the monthly data and see if it was mostly accurate — indeed, the data is updated through a process called “benchmarking” on a regular basis.
What do the latest QCEW show us? The headline number is that total employment grew by 2.3 million jobs from December 2022 to December 2023, which is 1.5% job growth (if we use annual averages, growth is a little stronger at 2%). That’s a healthy rate of job growth, but it’s less than the familiar Nonfarm Payroll series (CES) shows from December to December: about 3 million jobs added, or a growth rate of 1.8% If we focus just on private-sector employment, we see again that the monthly series is running faster than the more comprehensive QCEW: 2.3 million jobs in the monthly report added versus 1.7 million.
Does all this mean that the monthly jobs numbers are “fake”? Of course not. Surveys will always be imperfect, but they are still useful. But it does mean that you might want to discount them by about 25 percent.
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