CH: Unemployment

Fri Jan 09 00:45:00 CST 2015

Consensus Actual Previous Revised
SECO (NSA) 3.4% 3.4% 3.2%
SNB (SA) 3.1% 3.2% 3.1% 3.2%

The number of people out of work rose 18,817 to 147,369 in December to lift the jobless rate by 0.2 percentage points to 3.4 percent, its highest reading since February. However, the increase was dominated by seasonal factors and after adjusting for these, unemployment actually fell marginally to leave the adjusted jobless rate steady at November's upwardly revised level of 3.2 percent. Overall the data were on the weaker side of market expectations.

Moreover, a 0.4 percent monthly fall in seasonally adjusted vacancies (minus 9.8 percent unadjusted on the year) suggests that the demand for labour may be ebbing.

Today's results are broadly consistent with the findings of the December PMI which noted a sharp slowdown in the pace of job creation. Most other economic indicators have suggested that the Swiss economy held up relatively well at year-end but the latest jobless figures warn that momentum could have slowed going into 2015.

The unemployment rate measures the number of unemployed as a percentage of the labor force. The monthly report provides both raw and seasonally adjusted data; the latter are the more important for identifying short-term trends.

Like the employment data, unemployment data help to gauge the current state as well as the future direction of the economy. Employment data are categorized by sectors. This sector data can go a long way in helping investors determine in which economic sectors they intend to invest.

By tracking the jobs data, investors can sense the degree of tightness in the job market. If employment is tight it is a good bet that interest rates will rise and bond and stock prices will fall. In contrast, when job growth is slow or negative, then interest rates are likely to decline - boosting up bond and stock prices in the process.