Does Twitter compress the employment report news cycle?

December 5th, 2014 at 10:16 am

That’s my wholly unsubstantiated impression.

Back in the day when we used abacuses to calculate payroll growth, jobs day reporting on the numbers was pretty intense throughout the day. Over the past few years, it seems to die down pretty quickly (as you’ll see, I’m not saying that’s at all a bad thing).

My impression is that Twitter’s a factor here. Unlike me (and probably you), most people who want to know anything about the jobs report want the horse race results. Was it, in the opinion of the trackers, great, good, OK, not much, or awful? That assessment can take no more than a very quick look at the topline numbers, the revisions, and the extent to which they match up to expectations. And 140 characters is more than enough.

So my theory is that the bulk of consumers of this info are getting what they need in minutes after the release and that’s that.

The tendency of the analyst is to scoff at such superficiality, and I can go there. I think there’s value added in the deeper analysis that I and others try to do. But I’ve always thought that given the wide confidence interval around these monthly data, they can be over-scrutinized in ways that go beyond their actual signal as to what’s happening in the job market. So, in the spirit of downplaying low signal-to-noise inputs, perhaps the compressed news cycle–if that’s what’s actually happening–isn’t such a bad thing.

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