Are growth of the labor force and resident jobs slowing in DC? Maybe—and maybe not.

Seasonally-adjusted and unadjusted data from BLS currently tell different stories

Each month the US Bureau of Labor Statistics (BLS) estimates labor market statistics for all states and the District of Columbia. Labor market statistics include the labor force, resident employment, unemployment, and the unemployment rate. The data is reported on both a seasonally adjusted and unadjusted basis. Seasonal adjustment takes account of recurrent events during a year such as holiday employment that can mask trends in the data.

Typically, comparing data from the same month of the prior year eliminates the need for seasonal adjustment. Accordingly, it would be expected that there should be little difference between seasonally adjusted and unadjusted estimates of the annual change in DC resident employment from September 2017 to September 2018. Currently, however, the two data sets give very different pictures of the change over this time, leaving unanswered the question as to whether DC’s resident employment is or is not slowing significantly.

  • The seasonally-unadjusted data say that from September 2017 to September 2018 resident employment (measured by the 3-month moving average) increased by 3,870 (1.0%). By contrast, the seasonally-adjusted data peg the increase at twice that (8,067, a 2.1% gain).
  • The unadjusted data show quite a sharp decline in the amount of year-over- year growth since May 2018, while the adjusted data show an increase.
  • The unadjusted data peg growth over the past year at about half the annual average increase over the past 5 years. Seasonally adjusted, the growth is very close to the average of the past 5 years.          

Details are shown in the tables and charts in the appendix. As indicated there, the story is similar for the seasonally adjusted and unadjusted estimates of DC’s labor force.

The current difference between the one year change in the seasonally adjusted and unadjusted resident employment and labor force data is an unusually clear example of the difficulty in spotting changes in the economy by closely monitoring data as it is released each month or each quarter. As with Personal Income, population, and other data produced by federal agencies, labor market data is revised as more information becomes available.

As the labor force data is revised the current differences in the story about changes over the past year told by the seasonally-adjusted and unadjusted data will be resolved. However, it will likely not be until March 2019 when major annual revisions typically occur that the matter will be cleared up.

It should be noted, however, that the seasonally-adjusted and unadjusted data both tell the same story about unemployment: the amount and rate of unemployment fell over the past year.











About the data. The labor market information is from the statistics released each month for the District of Columbia (along with all states) based on a population survey. The data include resident employment (persons over 16 years of age who say they are working on a full or part time basis); unemployment (persons over 16 years of age who are not working but say they are looking for work); labor force (the sum of resident employment and unemployment); and the unemployment rate (unemployment as a percentage of the labor force).

The data are reported on both a seasonally adjusted and not seasonally adjusted basis. For the month of September 2018 the data reflect the revisions which were part of the October 2018 release. The annual comprehensive revision to the data will occur in March 2019. All calculations here are based on 3-month moving averages (e.g., September 2018 is the average of July, August, and September as reported by BLS).

Seasonal adjustment is a statistical method for removing the seasonal component of a time series that exhibits a seasonal pattern. It is usually done when wanting to analyze the trend of a time series during a year independently of the seasonal components. It is common, for example,  to report seasonally-adjusted data for unemployment rates to reveal the underlying trends in labor markets.

An earlier version of this blog was included in the October 2018 District of Columbia Economic and Revenue Trends report issued by the Office of Revenue Analysis of the District of Columbia Office of the Chief Financial Officer.



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