CHART OF THE DAY: This Indicator Is Flashing Strong Job Growth

button more charts
button chart prev
button chart next

The labour market has remained in flux since the summer began, particularly as summer auto plant shutdowns get postponed.

That’s made it difficult to get a proper gauge of the labour force.

If you’re not sure how to interpret the choppy initial claims data, there’s another indicator you can look to: Withheld Income & Employment Taxes. It also happens to be Deutsche Bank’s Joe LaVorgna’s favourite chart.

The reason? The federal government is always collecting payroll taxes. 

Lee Adler of The Wall Street Examiner pointed us to this today.

For July, the four week moving average is showing a six per cent gain compared to the year ago period. Adler estimates that could mean a nonfarm payrolls jump of 290,000 jobs in the July report due out next week. 

chart of the day, job growth indicator, july 2012

SEE ALSO: The 16 biggest mass layoffs of the year >

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at