Economic Recovery Scorecard – March 2022

Labor Market Measures Finally Reach 100% Recovery

Peter Bernstein, Chief Economist,, 312-431-1540 x1515

The latest RCF Recovery Scorecard is at 111%, down slightly from the 112% value in our February report.  The bigger news, however, is that our six labor market indicators (4 – 9 in the table below) had an average recovery of 100% meaning that as a group they have regained their recession losses.   The rebound was driven by a favorable March employment report which showed full-time employment exceeding its pre-recession level.  Later in this report we discuss the difference between payroll employment (only 93% recovered) and full-time employment (111% recovered).

Overall, 11 of our 16 metrics are at least 100% recovered from the recession, with only vehicle sales remaining far below its earlier peak.  Nevertheless, there is evidence that outside of the labor market, the economy is losing some strength as six measures declined this month including two of our three housing market indicators.  

Notes and methodology: All data are seasonally adjusted monthly values. Variables 4 through 9, and 13 are data from March; all others are from February. Example calculation for economic variable #1, real income less government transfers fell 8.0% from its February 2020 value to its low point in April 2020. In the latest available report, the variable was 1.0% above its peak value. Therefore, it has recovered 113% of the loss. Data Sources: #1, 2, 3, 12, 13: Bureau of Economic Analysis; #4, 5, 6, 7, 8: Bureau of Labor Statistics; #9: U.S. Employment and Training Administration; #10: Federal Reserve; #11: Bureau of the Census; #14, 15: Bureau of the Census and U.S. Department of Housing and Urban Development, #16: National Association of Realtors.

Two Measure of Employment Recovery

Taken together, our six labor market measures finally attained an average recovery of 100% in March.  However, within this group there is a divergence between the recovery of payroll employment (93%) and the recovery of full-time employment (111%).  Payroll employment data come from the Bureau of Labor Statistics survey of businesses and are the typical source behind the job gain measures that are reported each month.  In March, the BLS estimated that there were 150.9 million workers on business payrolls, still 2.6 million below the pre-recession number from early 2020.

Full-time employment comes from the BLS survey of households and is usually given less attention.  It showed 132.7 million full-time employees in March, 1.9 million more than before the recession.  To an extent, the differences between these two employment recoveries stem from the data coming from two different sources.  A key difference is that the household survey includes self-employed people who are working but not on a company’s payroll.  But more importantly, the difference shows that while the payroll numbers get the most attention, they are not the only measure of the state of the employment recovery.   That’s why a composite measure reflected in our six labor market indicators provides a clearer picture of the recovery than any single number. 

It is typically the case that the labor markets are the last major sector of the economy to recover from a recession.  And it will take several more months for payroll employment to fully recover its recession losses.  Still, it is important to recognize that other labor measures are performing better, with new unemployment claims and the unemployment rate at or close to their early 2020 levels in addition to the increase in full-time employment noted above. 

Appendix – Recent History of Recovery Scorecard

Note:  Historical data are often revised so comparisons with earlier RCF Scorecards may reflect the impact of revisions. 

Monthly Recovery Percentages