Market watchers will have plenty of time to digest their holiday barbecues -- and Friday's hefty employment report -- in a relatively light upcoming data week that features confidence measures for small businesses and consumers, along with an inflation hint in new figures on import prices.

Indeed, there was a lot to digest in the employment report, with some parts more difficult to digest than others.

A couple of little-noticed pieces of the monthly report are particularly unpalatable. Take for example the employment-population ratio that measures the percentage of those 16 or older with jobs – or conversely, without jobs. 

According to that ratio, 37.6% of the over-16 population does not have a job, the highest percentage in more than three years. This is a broader measure than the unemployment rate, which considers only those who are actively seeking employment, ignoring those who have given up the chase as 438,000 jobs have disappeared in the first six months of the year. The number would have been higher – by 126,000 – if newly-created government jobs were left out of the equation. With local governments facing severe budget shortages, it may be only a matter of time before they start adding to, rather than subtracting, from total job losses.

(There was also a statistical quirk in the June employment report: In each of the last three months, private sector payrolls fell by 91,000--not an average, but the exact number each month.)

In the last year, the economy has added just 15,000 job -- after including 257,000 government jobs – for the weakest 12-month performance since 2003 when total payrolls expanded by 87,000 (when government payrolls contracted by 12,000).

The importance of the drop in the employment-population ratio cannot be overstated. Simply put, it means fewer people are drawing paychecks, affecting retail activity and -- for debt-laden households -- delinquencies on mortgage, auto and credit card loans.

One of the other often-overlooked indicators in the employment report is the often-overlooked “diffusion index,” a “stealth” data point that tracks the number of industries increasing and decreasing jobs. According to the Bureau of Labor Statistics, a 50% measure in the diffusion index “indicates an equal balance between industries with increasing and decreasing employment.” 

In the June report, the diffusion indices measured over a one-, three-, six- and 12-month time span were all below 50% corroborating how widespread the economic downturn is. According to Goldman Sachs, “the composition of payroll losses suggests further weakness ahead.” Goldman noted “sectors such as construction, temporary help, and finance were all in the negative column.”

Against this backdrop, the National Federation of Independent Businesses will report on small business confidence Tuesday. Small business optimism fell to an all-time low (the survey began in 1986) in May with an ominously low net percentage of small business owners --2% -- saying they planned to hire, the weakest hiring plans since December 1991.

One of the more interesting numbers will be Tuesday’s Federal Reserve report on consumer credit. Analysts are expecting an increase in revolving credit outstanding (credit card usage) even though the personal income report for May showed disposable income in May (including government stimulus payments) exceeded spending by over $555 billion.

Perhaps more telling will be Friday’s report from the University of Michigan on preliminary results of its July consumer confidence survey, expected to show a slight dip from June’s 56.4 reading – the lowest level in 28 years.

For inflation watchers, Friday’s reports will also include data on import prices, expected to rise at the slowest rate in four months which could be good news since imports make up roughly 15% of the goods purchased in the U.S.

Mark Lieberman is the senior economist for the Fox Business Network. Prior to joining FOX, he served as first vice president at Washington Mutual, where he was manager of economic analysis and research. Before that, he served as senior vice president at Dime Savings Bank of New York (which was later acquired by Washington Mutual), where he specialized in credit and risk management. He has a degree in Economics from the Wharton School of the University of Pennsylvania.