CH: Unemployment

August 9, 2016 12:45 CDT

Consensus Actual Previous
SECO (NSA) 3.1% 3.1% 3.1%
SNB (SA) 3.3% 3.3% 3.3%

The jobs market moved in line with expectations in July. Unadjusted unemployment rose 183 (0.1 percent) to 139,310 which left the jobless rate unchanged at 3.1 percent. Seasonal factors are slightly negative and, adjusted, the number of people out of work was up 238 (0.2 percent) at 150,129. This was also small enough to keep the adjusted rate at June's 3.3 percent.

However, adjusted vacancies were only flat on the month and up an unadjusted 2.9 percent on the year after a 7.5 percent increase last time.

Today's data suggest little change in underlying trends. However, the slowdown in the growth of vacancies is consistent with the slightly softer picture painted by the latest PMI survey and warns that the market has probably only really stabilised at best. This could become a drag on household spending later in the year.

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.