Recession? What recession?

Here is what the six economic indicators the NBER uses to determine a recession look like updated with the new jobs data. Employment still going strong this year.

The overall labor force participation rate increased in August, driving up the unemployment rate slightly (people that were out of the labor force started to look for work). The labor force participation rate is now at 62.4%. Only 1% off of where it was in February 2020. The gap is largely from lower labor force participation among men aged 55 and older.

Prime age labor force participation is at 82.8%. Only 0.2% off of where it was in February 2020.

Even still we are missing workers due to deaths from the pandemic and from lower immigration in recent years. And as a result we are only back to pre-pandemic employment levels.

Non-farm payroll employment rose 315k in August better than expectations of 300k.

Unemployment rose slightly to 3.7% in August from 3.5% in July. The increase in the unemployment rate was driven by higher labor force participation which rose to 62.4% (the unemployment rate is based on workers seeking employment, so if participation rises, unemployment will rise, even if there was no increase in job losses).

Women and younger men are basically back to work. It is mostly older men 55+ that still haven't recovered their pre-pandemic labor force participation. Prime-age labor force participation is nearly back to pre-pandemic levels.

But since we have had ~1.2 million excess deaths and have had lower immigration to the US this pandemic, we are still missing a lot of workers. That's why labor markets are so tight.