January 10, 2025
In any given month employers can boost output by either additional hiring workers or by lengthening the number of hours that their employees work. Payroll employment rose by 246 thousand in December. At the same time the nonfarm workweek was unchanged at 34.3 hours.
The combinations of moderate employment and fewer hours worked seem to suggest that the labor market has been relatively steady in recent months.
The changes in employment and hours worked are reflected in the aggregate hours index which rose 0.2% in December to 117.1 after having risen 0.1% in November The aggregate hours index increased 1.4% in the fourth quarter which, assuming a further increase in productivity, should lead to 2.5% GDP growth in that quarter.
The factory workweek declined 0.1 hour in December to 40.0 after having risen 0.2 hour in November. The manufacturing sector has slowed steadily during the past year, but has been fairly steady in recent months.
Overtime hours declined 0.1 hour in December to 2.8 hours after having risen 0.1 hour in November. Manufacturers have adjusted to reduced demand by cutting overtime hours.
Stephen Slifer
NumberNomics
Charleston, SC
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