How To Crunch The Jobs Data

As we've stated herein, we're paying very close attention to the U.S. employment picture, as it's our view that a rolling over of the labor market will be the straw that ultimately breaks the back of the economic/stock market bull camel; now on its longest-ever journey.

The thing about the jobs numbers are that they presently look great in number.

Here's a look at the numbers (through 10/31) for the most important cohort; U.S. small businesses -- the employers of 2/3rds of us: click to enlarge...



And here's for those employing 1-19: 



Now, when you eyeball the above graphs back to just before the Great Recession of 2008 (the grey-shaded area), you have to wonder how this data can be of any help whatsoever; being that things looked great right up to the very end.

Ah, but that's where rate of change analysis comes in!

Here's a look at the numbers on a year-over-year change basis for the 1-49 employers:   



And here's for those employing 1 to 19:



Absolutely, as you can now see, the jobs data were flashing huge warning signs leading into the last meltdown; you just had to know from what angle to view them.

And they're not looking so rosy these days either. Hence our presently-defensive posture...