Jobs Decrease by 54,000, Rise by 60,000 Excluding Census; Unemployment Rises Slightly to 9.6%; A Look Beneath the Surface
by ilene - September 4th, 2010 3:13 am
Jobs Decrease by 54,000, Rise by 60,000 Excluding Census; Unemployment Rises Slightly to 9.6%; A Look Beneath the Surface
Courtesy of Mish
This morning the BLS reported a decrease of 64,000 jobs. However, that reflects a decrease of 114,000 temporary census workers.
Excluding the census effect, government lost 7,000 jobs. Were the trend to continue, this would be a good thing because Firing Public Union Workers Creates Real Jobs.
Unfortunately, politicians and Keynesian clown economists will not see it that way. Indeed there is a $26 billion bill giving money to the states to keep bureaucrats employed. This is unfortunate because we need to shed government jobs.
Hidden beneath the surface the BLS Black Box – Birth Death Model added 115,000 jobs, a number likely to be revised lower in coming years. Please note you cannot directly subtract the number from the total because of the way the BLS computes its overall number.
Participation Rate Effects
The civilian labor force participation rate (64.7 percent) and the employment-population ratio (58.5 percent) were essentially unchanged from last month’s report. However, these measures have declined by 0.5 percentage points and 0.3 points, respectively, since April.
The drop in participation rate this year is the only reason the unemployment rate is not over 10%. The drop in participation rates is not that surprising because some of the long-term unemployed stopped looking jobs, or opted for retirement.
Nonetheless, I still do not think the top in the unemployment rate is in and expect it may rise substantially later this year as the recovery heads into a coma and states are forced to cut back workers unless Congress does substantially more to support states.
Employment and Recessions
Calculated Risk has a great chart showing the effects of census hiring as well as the extremely weak hiring in this recovery.
click on chart for sharper image
The dotted lines tell the real story about how pathetic a jobs recovery this has been. Bear in mind it has taken $trillions in stimulus to produce this.
June, July Revisions
The change in total nonfarm payroll employment for June was revised from -221,000 to -175,000, and the change for July was revised from -131,000 to -54,000.
by ilene - April 24th, 2010 4:41 pm
Courtesy of David DeGraw, AmpedStatus Report
This report was originally released as a six-part series. The first part was published on February 15, 2010. The last part was published on February 27, 2010.
- I: Casualties of Economic Terrorism, Surveying the Damage
- II: The Rise of the Economic Elite
- III: Exposing Our Enemy: Meet the Economic Elite
- IV: The Financial Coup d’Etat
- V: Overcoming the Divide and Conquer Strategy
- VI: How to Fight Back and Win: Common Ground Issues That Must Be Won
> Download full report with graphics and links.
> Download printer-friendly version.
but the success of its disappearing act depends on equally strenuous efforts
on the part of an American public anxious to believe in egalitarian fictions
and unwilling to see what is hidden in plain sight.”
– Michael Lind, To Have and to Have Not
It’s time for 99% of Americans to mobilize and aggressively move on common sense political reforms.
Yes, of course, we all have very strong differences of opinion on many issues. However, like our Founding Fathers before us, we must put aside our differences and unite to fight a common enemy.
by ilene - April 2nd, 2010 4:34 pm
Courtesy of The Pragmatic Capitalist
A smattering of analyst opinions on the job’s reportappears pretty mixed. I think the main takeaway here is that this is not a huge market moving event. The improvement is meager and there is A LOT of work yet to be done before we can claim a recovery:
- Goldman Sachs: March Shows Little Underlying Improvement But Other Data Firm
BOTTOM LINE: In a report with something for everyone, payrolls bounce 162,000 in March, due mainly if not entirely to census hiring and weather rebound. On the positive side, payroll data for prior months revised up, and survey of households shows third consecutive month of large job gains. On the negative side, measures of labor utilization – the official unemployment rate as well as the broader “U6″ underemployment rate – remain high, and wages suffer a setback.
- Miller Tabak: Today’s employment report is, in our opinion, quite good, although not without its drawbacks. Income growth continues to be lackluster, complicating the spending picture in the immediate future. However, should job growth prove sustainable, incomes will catch up to spending patterns, thus validating the improvement we’ve seen in the first quarter. Simultaneously, it is quite worrisome to see the ranks of the long-term unemployed swell further. There is concern surrounding the skillset of these individuals and the longer they are out of the workforce, the further their skills erode. However, this action shouldn’t be entirely surprising given the fallout in the construction, manufacturing, housing and financial sectors. Indeed, nearly 52% of people are classified as “not on temporary layoff.” That is to say, more than half the unemployed are not getting their jobs back.
by phil - April 2nd, 2010 8:21 am
US Markets are closed today.
Most markets are closed. Japan was open and they went up 41 points (0.37%) and the MSCI Asia Pacific Index also went up 0.3% in Tokyo 1trading and Russia fell 0.1% but markets in Australia, Hong Kong, China, New Zealand, Singapore, India, the Philippines, Indonesia, the U.S. and all of western Europe are closed today for holidays. Strangley though, the Futures Market is open this morning so that can make things very tricky on a big data day like today.
The MSCI Asia Pacific Index has gained 1.7 percent this week as growth in China’s manufacturing and an increase in U.S. consumer spending bolstered optimism the global economic recovery is gaining momentum. The index this week completed its fourth consecutive quarterly advance with a 3.9 percent increase in the three months through March 31. Shares in the gauge trade at 16.4 times estimated earnings, compared with 14.8 times for the MSCI World Index of 23 developed nations. “The global macroeconomic recovery is behind the current uptrend in equities,” said Tomomi Yamashita, of $3.8Bn Shinkin Asset Management. “That trend is unlikely to change though the market is getting overheated.”
We get Non-Farm Payrolls at 8:30 and, obviously, investors are expecting a report that shows the US firmly on the road to recovery but I have already been reading a Gallup poll on Underemployment that suggests otherwise. According to the March tracking poll, 20.3% of the US workforce was UNDERemployed and that is UP 0.5% from February. . Gallup classifies respondents as underemployed if they are unemployed or working part-time but wanting full-time work. Gallup employment data are not seasonally adjusted.
Those underemployed people are mainly counted as employed in the NFP report and are a major distortion of the numbers, especially as the main delta component was a huge rise in part-time workers, from 9.2% to 9.9% and, like temps, they tend to be counted by the government as happy, happy workers. Unemployment (no job at all) measured by Gallup decreased from 10.6% to 10.4% and you can see from the following chart how those two are related:
According to Gallup, as unemployed Americans find part-time, temporary, and seasonal work, the official unemployment rate could decline. However, this does not necessarily mean more Americans are working at their desired capacity. It will continue to be important to track underemployment — to shed light on the true state of the U.S. workforce, and the millions of Americans who are searching…
by ilene - January 14th, 2010 7:58 am
Courtesy of Mish
Inquiring minds are reading the "Good News" from the Fed’s Beige Book today.
Reports from the twelve Federal Reserve Districts indicated that while economic activity remains at a low level, conditions have improved modestly further, and those improvements are broader geographically than in the last report.
- Consumer spending: The recent 2009 holiday season was modestly greater than in 2008 for eight Districts, although as retailers in the Philadelphia and San Francisco Districts noted, 2008 sales were so low compared with 2007, that the relatively small 2009 gains did not represent a significant shift in trend.
- Nonfinancial Services: Districts reporting on nonfinancial services generally indicated an upward trend in activity, although in some areas reports were mixed.
- Manufacturing: Manufacturing activity has improved since the last report in six Districts.
- Residential: Homes sales increased toward the end of 2009 in most Federal Reserve Districts, except San Francisco, where demand for housing has been steady, and Kansas City, where residential real estate activity has eased since the last Beige Book. In New York, Richmond, and Atlanta, residential real estate activity was described as mixed across areas of the District. In the Atlanta District, existing home sales increased, but new home sales decreased. In all Districts, sales of lower-priced homes tended to increase proportionately more than sales of higher-priced homes, due at least in part to the first-time buyer federal tax credit, according to real estate contacts. In several Districts real estate contacts reported that the original expiration date for the credit boosted sales in November and led to a more than usual slowdown in sales in December.
- Nonresidential: Nonresidential real estate conditions remained soft in nearly all Districts. New York, Philadelphia, Kansas City, and San Francisco reported further weakening in demand for commercial and industrial space.
- Employment, Wages, and Prices: Labor market conditions remained soft in most Federal Reserve Districts, although New York reported a modest pickup in hiring and St. Louis reported that several service-sector firms in that District recently announced plans to hire new workers.
- Loan Demand: Loan demand continued to decline or remained weak in most Districts. St. Louis, Kansas City, Dallas, and San Francisco noted general declines or soft
by ilene - October 4th, 2009 2:34 pm
There’s really no way to cast the job numbers into a positive light. Robert Reich’s views on the current situation.
Courtesy of Robert Reich writing at Robert Reich’s Blog
Unemployment will almost certainly in double-digits next year — and may remain there for some time. And for every person who shows up as unemployed in the Bureau of Labor Statistics’ household survey, you can bet there’s another either too discouraged to look for work or working part time who’d rather have a full-time job or else taking home less pay than before (I’m in the last category, now that the University of California has instituted pay cuts). And there’s yet another person who’s more fearful that he or she will be next to lose a job.
In other words, ten percent unemployment really means twenty percent underemployment or anxious employment. All of which translates directly into late payments on mortgages, credit cards, auto and student loans, and loss of health insurance. It also means sleeplessness for tens of millions of Americans. And, of course, fewer purchases (more on this in a moment).
Unemployment of this magnitude and duration also translates into ugly politics, because fear and anxiety are fertile grounds for demagogues weilding the politics of resentment against immigrants, blacks, the poor, government leaders, business leaders, Jews, and other easy targets. It’s already started. Next year is a mid-term election. Be prepared for worse.
So why is unemployment and underemployment so high, and why is it likely to remain high for some time? Because, as noted, people who are worried about their jobs or have no jobs, and who are also trying to get out from under a pile of debt, are not going do a lot of shopping. And businesses that don’t have customers aren’t going do a lot of new investing. And foreign nations also suffering high unemployment aren’t going to buy a lot of our goods and services.
And without customers, companies won’t hire. They’ll cut payrolls instead.
Which brings us to the obvious question: Who’s going to buy the stuff we make or the services we provide, and therefore bring jobs back? There’s only one buyer left: The government.
by phil - July 9th, 2009 5:30 pm
Courtesy of John Lounsbury:
The current official unemployment figure (9.5% for June) should be replaced (or at least supplemented) by a better measurement of actual unemployment. Unemployment should be measured in terms of hours worked by all employees, full-time and part-time. Counting full- and part-time workers equally is giving misleading statistics. Hours per employee, which are changing over time, are not properly recognized in unemployment as currently reported.
Part-time employment for economic reasons – U.S. Dept. of Labor (DOL) terminology – is not directly recognized in the official unemployment rate (U-3). If a person who is working half-time wants to work full-time, but cannot find full-time work, this is the equivalent of half a job lost. The same is true for an employee being forced by an employer to cut half his hours.
The official DOL unemployment rate counts either individual equally with full-time employees in measuring the level of employment. This was discussed in recent articles (here and here) and will be analyzed in detail in this article. John Mauldin has also discussed this problem is some detail recently (here).
Involuntary part-time employment increases significantly in economic downturns, whereas part-time by choice (“part-time for non-economic reasons” in DOL terminology) is much less changed from its trend roughly proportional to the increase in the workforce with time. This is shown in the following two graphs (from DOL BLS Table A-5).
Note that there is a big jump in the non-economic graph from December, 1993 to January, 2004, presumably from a change in the measurement rules. There is a drop of the same magnitude for employed part-time for economic reasons at the same time. Apparently, at that time, some of the people who formerly would have been counted as involuntary part-time were transferred to part-time by choice.
There are a number of areas that must be examined to try to determine how involuntary part-time employment should be included in what I have chosen to call “implied total unemployment”.
Among these are:
- the definition of full-time employment;
- determination of the average work hours in a part-time week;
- calculation of the implied total unemployment when data is