by Calculated Risk on 1/11/2014 05:13:00 PM

Just over two years ago I posted a graph with projections of when payroll employment would return to pre-recession levels (see: Sluggish Growth and Payroll Employment from November 2011).

In 2011, I argued we'd continue to see sluggish growth (back in 2011 many analysts were forecasting another US recession - those forecasts were wrong).

  On the graph I posted two lines - one with payroll growth of 125,000 payroll jobs added per month (the pace in 2011), and another line with 200,000 payroll jobs per month.  The following graph is an update with reported payroll growth through December 2013.

The dashed red line is 125,000 payroll jobs added per month. The dashed blue line is 200,000 payroll jobs per month.  Both projections are from November 2011.

Click on graph for larger image.

So far the economy has tracked just below the blue line (200,000 payroll jobs per month).

Right now it appears payrolls will exceed the pre-recession peak in mid-2014.

Currently there are about 1.18 million fewer payroll jobs than before the recession started, and at the expected pace of job growth in 2014 it will take about 6 months to reach the previous peak.  

Of course this doesn't include population growth and new entrants into the workforce (the workforce has continued to grow).  Also the annual benchmark revision will be released in February (with the January employment report), and the preliminary estimate is an upward revision of 345,000 jobs - HOWEVER the increase is due to a classification change, and the actual impact will probably be  negative.

Note: There are 640 thousand fewer private sector payroll jobs than before the recession started. At the expected pace of private sector job growth, the private sector could be back at the pre-recession peak in March 2014.