by Calculated Risk on 6/02/2016 10:56:00 AM

Approximately 40,000 Verizon workers went on strike on April 13th, and returned to work on June 1st.

What will be the impact on the May employment report?

These workers were on strike during the reference period in May and will not be counted as employed.  Since the strike is over, they will be counted as employed in the June 2016 report.

To see the impact, we can look back at the Verizon strike in 2011.  That strike started on Aug 6th and ended on Aug 20th.  Those workers were not employed during the August reference period, and the BLS reported a loss of 48.6 thousand telecommunications workers in August 2011, and a gain of 43.0 thousand workers in September 2011 seasonally adjusted (SA).

The impact from the strike on the May employment report will be obvious in the Information Super Sector under the Telecommunications Industry. This is one of the first items I will check tomorrow morning.

If the employment report shows a loss of 40,000 telecommunications workers (SA), then it will be reasonable to add those to the headline employment number to look at the underlying trend (they will be added back in the June BLS report - and we will need to subtract those workers in June to see the underlying trend).

As an example, if the BLS reports 120,000 jobs added in May, and 40,000 telecommunication jobs lost in May, the underlying trend would be 160,000 (and the reverse in June).

Note: Some of the recent increase in the 4-week average of unemployment claims is probably related to the Verizon strike too.