An insignificant change in July job numbers from 9.2% unemployed to 9.1% is partly due to people giving up, but what we will hear in the news is “good news, the job picture is improving.” This good news is as good as hearing there were survivors on the Hindenburg.
Reuters: U.S. jobs are up 117,000, bringing the unemployment rate to 9.1%, down from 9.2%. This is bad news that will be spun by the media into a good sign. The fact is that the unemployment rate fell partly because some unemployed workers stopped looking for work. That means they are no longer counted in the unemployment numbers. In addition, unless we have twice as many net jobs per month, the jobs pictures will not change.
Gallup reports 8.9% with 17.9% underemployed, not seasonally adjusted. The U.S. economy grew at a paltry 0.8% annual rate for the first six months. Michael Feroli, an economist at JPMorgan Chase, on Wednesday said he thinks the economy will grow at a meager 1.5 percent annual rate in the July-September period, down from an earlier estimate of 2.5 percent.
The economy needs to expand at an annual rate of at least 2.5 percent to keep the unemployment rate from rising.
Youth unemployed from the Bureau of Labor Statistics –
From April to July 2010, the number of employed youth 16 to 24 years old rose by 1.8 million to 18.6 million, the U.S. Bureau of Labor Statistics reported. This year, the share of young people who were employed in July was 48.9%, the lowest July rate on record for the series, which began in 1948. The month of July typically is the summertime peak in youth employment. Unemployment among youth increased by 571,000 between April and July, about half as much as in each of the two previous summers. The data is not seasonally adjusted.
FROM ECONOMIC POPULIST.ORG: The problem with this decrease in unemployment number is we do not know the percentage of those who simply fell off the count and didn’t get a job. We do know those being no longer counted as part of the labor force increased by 449,000 in one month. 44.4% of the official unemployed have been so for 27 weeks or longer. That’s close to half of the official unemployed looking for work for over 6 months.
Long term unemployed – 6.3 million
Forced Part Time – 8.6 million
Marginally attached to the labor force – 2.7 million
Below you think computer jobs, technical jobs are roaring back, think again. Our government likes to count foreign guest workers in the job statistics. These are most often cheaper replacements, used to displace and labor arbitrage U.S. professionals. Of course the government refuses to differentiate between guest workers and U.S. citizens in occupational employment statistics as well as give an accurate tally of how many, or what type of guest worker are in the country at one time.
The fact health and education jobs have not grown this month is not a good sign. Teachers are clearly getting slaughtered.
While for some reason public or government workers are under assault, local government employees are clearly hurting. There has been 468,000 local government jobs lost since August 2008.
Below is the graph of the monthly change in manufacturing payroll jobs, seasonally adjusted, against the ISM Manufacturing Employment Index. Due to last month’s -5k manufacturing jobs, growth in reality is flat. Amazing how well the ISM tracks the BLS actual manufacturing jobs by rate of change
Bear in mind illegal workers and foreign guest workers are counted as employed Americans, which can distort occupational sectors, particularly the Engineering, I.T., Science and Technology ones. Below are the unemployment rates per occupational sector from table A-14, not seasonally adjusted.
Transportation, Utilities: 8.2%
Mining & Gas, Oil: 5.2%
Health and Education: 5.8%
Leisure and Hospitality: 10.9%
Professional & Business Services: 9.1%
Retail, Wholesale Trade: 9.7%
“Other” Services: 8.7%
Self-employed, unpaid family: 5.7%
Probably the most horrific not seasonally adjusted unemployment rate is the 9.8% for Professional and Business Services unemployment rate. This occupation category implies a college degree. This particular area is fraught with foreign guest worker Visas, which distorts the real occupational unemployment rate. If an American is displaced by a foreign guest worker, then is forced to take a job at Walmart, that person is no longer categorized as a Chemical Engineering PhD out of work, but instead as a retail trade worker. So bear in mind all of these high occupational unemployment rates will miss people who took a lower paying job at Target in their statistics. Read more here: Dire news despite what you hear on TV