Hysteresis - the problem in the US jobs market

I may have been initially fooled by the job report like the rest of the market. I have stopped looking at the unemployment number but a more careful eye is needed with all these government numbers. I was a little more skeptical given the increase in jobs just offset some of the below expected numbers earlier in the year, but you look at the headline and see that it beats expectations and you are ready to follow the crowd. It is hard to argue against following positive surprises, yet a close look at the jobs number does not show a labor market that robust.

30% of the jobs created were part-time. The number searching for work are down. Long-term unemployed is still growing. Job creation is not for the young. Workers are just dropping out of the labor market. The US is getting more like Europe which sufferers from labor market hysteresis. The long-term unemployment may not be able to come back into the workforce. Young people who do not get jobs will not gain skills. Part-time work does not provide a long-term labor solution. The problems today will create labor issues that will not be rectified with stronger growth.

So what happens when the next jobs report comes out? Unfortunately, the headline number should be ignored. The systematic approach of following the price action may not be perfect but it could be the best alternative in an irrational jobs reporting world