US employment report Friday – feel the excitement. However there are three structural problems with interpreting the data. First, there does appear to be a shortage of skilled and semi-skilled labour, and that may constrain payrolls by keeping vacancies unfilled.
Second, US growth data is generally being revised higher. Today's initial number could conceivably double (for instance) but we will not know about that for many months. Failing to capture small business data properly contributes to this.
Third, the way we work has changed. Contract work and self-employment impacts data on payrolls, productivity, hours worked, earnings etc. The employment report seems more suited to the working practices of the 1950s than the working practices of today.
To no one's surprise PM Abe of Japan announced the delay of the consumption tax increase. The three arrows of Abenomics are basically just broken bits of kindling on the ground. The question for markets, of course, is "now what?". New and innovative policy ideas seem in short supply.