The jobs report: You have to admit, it’s getting better

[...] Justin writes about the new payroll data and unemployment [...]

I realize it’s a small number of jobs lost compared to other months. But how is it that the unemployment number fell to 10% following a loss of 11,000 jobs?

You say that payroll employment still shows a decline, and that that’s the more reliable figure, so I think “it’s getting better” is something of an overstatement to describe a slowdown in the rate of job loss. (Wasn’t it the Reagan administration who touted a reduction in the rate of increase of government spending as a “spending cut”?) Until we’re adding new jobs, things are not “getting better”. They’re merely getting worse at a slower rate than they were before. (For math nerds: Improvement would be a positive first derivative; what we’ve got here is a positive second derivative while the first derivative is still negative.)

Al Gore made a similar point about carbon emissions in “An Inconvenient Truth”. Kyoto (and now Copenhagen) is only about reducing the rate at which we pour CO2 into the atmosphere. But until we reduce that rate to less than the rate at which it’s being removed (and the natural processes for removing it are much slower than the industrial and natural processes that add it), the overall picture is still getting worse.

Admittedly, the slowdown is a positive trend, indicating that things may start improving soon, but until new jobs are being added, I don’t think for America’s working poor would agree that things are “getting better”.

Different data. The unemployment number comes from the household survey, which showed an increase in employment of 227,000 (but is, as I note in the post, kind of noisy and unreliable on a month-to-month basis) while the payroll employment number comes from the establishment survey.

You’re right, of course, but the temptation to quote the Beatles was just too great.

Thanks for your post, esp. on U-6 stuff. I wonder how that’s calculated – how does BLS track those who fell off the grid or work part-time but really want to be elsewhere? Do govt. officials and other biz media NOT highlight U-6 because it’s a much higher / worse looking number? (What, the U-2 doesn’t calculate unemployed musicians looking for new gigs?)
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Barbara posted a comment in her last post about discouraged workers going back to looking might nudge rates up. Might the markets be spooked by this, or see it as positive if people try to find work again – providing the jobs are there? thanks

[...] Glass half full: companies are firing less. Glass half empty: they’re hiring less as [...]

Markets seem to react mainly to the payroll numbers, not the unemployment rate.

[...] 6 décadas, y sólo superado por el desempleo de 1983. Sin embargo, y como señala Justin Fox en Time, “hay que admitir que esá mejorando”. Una tasa de desempleo de 10% representa a 15,4 [...]

[...] recession is over is the hours index, and that turned positive for the first time this month. As Justin Fox correctly points out, the data could get revised again, but if they didn’t and if December [...]

I concur with Justin here. The real unemployment / underemployment rate is certainly not a mystery here. Everyone knows it is at 17.5 / 18%.
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The real question is when will jobs return so that Americans have some buying power and can return to being the consumer of first and last resort. That is what will drive markets. If we don’t get our jobs situation figured out, the market will be flat to very down a year from now.http://img.timeinc.net/time/i/blogs-comments-submit.png?m=1246829640

No, it’s not getting better. Temporarily getting worse at slightly slower rate is not the same as “better”. The temporary lull in the rate at which we are tumbling down the cliff has only to do with the natural TEMPORARY increase in retail and support employment in preparation for the holiday season. After the Holidays you will likely see yet another spike in the unemployment / job loss rate.

These numbers are all seasonally adjusted, so—in theory, at least—the holiday hiring bulge shouldn’t be an issue. Without the seasonal adjustment, payroll employment was actually up both last month and this month.

this holiday season is unique because there are a significant number of retailers who are just hanging on until the end of it, after which they will shut their doors…

Are you looking for justification for your belief that no matter what the government policy is the economy is always grow?

There are still more people unemployed, albeit less compared to previous months, yet the rate has just dropped from 10.2% to 10%.

This could only mean two things: either the base number of jobless becomes much larger suddenly (hence a lower percentage) or some experts in the know are manipulating and tampering with figures to make the situation look good to fit in their schemes.

We live in a nasty world, watching smart people playing games by their own rules, everywhere, all the time.
(btt1943)

Thanks for the reply, Justin. I appreciate it and the info. Having had the weekend to absorb some of the info and numbers It makes a bit more sense to me. Though i don’t think the number accurately reflects the real unemployment rate, I have a better grasp on what they reported.

really, it is unstable or insecure for everyone, the report in the news are changing for better at times, for worse another week.
God bless!

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