My comments on the latest employment report:

1. Pay no attention to the household survey. That is true in any month. The household survey on a monthly basis contains much noise. The establishment survey is nearly all signal. The establishment survey shows gains of 250,000 jobs per month for the past several months.

2. Employment has a lot of momentum. A few years ago, I wrote,

I have 603 observations of three-month averages followed by one-month values.

327 have medium job growth in the three-month period followed by medium job growth in the next month.
112 have low job growth followed by low job growth
63 have medium followed by low
45 have medium followed by high
33 have low followed by medium
14 have high followed by medium
8 have high followed by high
1 has low followed by high (December 1970, looks fluky)
0 have high followed by low

3. My definition of “high” job growth is 350,000 per month. Medium is 50,000 to 350,000. So what we are experiencing is growth on the high end of medium.

4. What to make of the low increase in earnings–1.7 percent year over year? From the perspective of mid-1970s macro, you say that slow wage growth increased labor demand, raising employment. From the perspective of pre-1970s macro, you say. . .Whaa??? Another data point that lies off the Phillips Curve. If you take a PSST perspective, you say that you did not expect to see a Phillips Curve, anyway.