This morning, the Department of Labor released its monthly jobs report. During May, 345,000 jobs were lost and the unemployment rate reached 9.4%
The job loss was much better than anticipated: economists were expecting a loss of more than 500,000.
The four-month running average of the jobs number declined for the second straight month. When this value declines for four months, it has been a reliable indicator that a recession has ended. This is yet more encouraging news, suggesting that the severe recession begun during the Bush administration may be at an end.
Showing posts with label Unemployment Rate. Show all posts
Showing posts with label Unemployment Rate. Show all posts
Friday, June 5, 2009
Tuesday, January 13, 2009
January 20, 2009 – Thank Goodness!!
Next Tuesday at 11:30am, President-elect Barack Obama will assume the Presidency of the United States of America. What a wonderful moment that will be! We cannot know for certain what the future will bring, but once again we can be hopeful that the future will be better than the past.
Our country faces the most severe economic crisis in three generations. Rather than working to solve these problems, President Bush has chosen to spend his last days in office in an attempt to polish his legacy.
For many, it is difficult to remember where we were eight years ago and what these years have meant to the average citizen of this country. Let’s take a look at some of these aspects of our national economy.
The Gross Domestic Product (GDP) is the measure of the total value of all goods and services produced in the country. During the eight years of the President Clinton, when adjusted for inflation, it grew at an annual rate of 3.6%. During the past eight years, it has grown 2.2% per year. When you factor in the fact that our population grows at about 1% per year, these figures become 2.6% vs. 1.2% in terms of the amount of goods and services produced, and therefore available to, each citizen.
Recessions, as defined by the National Bureau of Economic Research, are periods of reduced economic activity: GDP declines and unemployment rises. During the past eight years, two recessions have begun. During the eight years under President Clinton, there were no recessions. This has been a repeating pattern in recent years: of the past 11 recessions, 10 began with Republicans in the White House.
Despite what President Bush has said again and again, he did NOT inherit a country in recession. The recession of 2001 began five months after his election. It was also not caused by the attacks of 9/11: it began five months prior to that terrible day.
The years of President Bush have been particularly hard on working Americans. Although he will boast that three million jobs were created during his two terms, over 14 million jobs were needed just to keep up with our increasing population. This means that there was a “jobs deficit” of over 11 million during his Presidency. There has been a deficit in five of his eight years. In contrast, there were 23 million jobs created during President Clinton’s term in office, far more than the 13 million needed to keep up with growth in the work force. In every year of the Clinton Presidency, there were more jobs created than were needed to employ our growing population. In my lifetime, two Presidents have overseen periods of “jobs deficits”, and their names were Bush.
The Stock Market is also an indicator of economic growth, although it is not solely due to activities within our country: most large corporations do business around the world. During the past eight years, the Dow Jones Industrial Average has declined by 17%. In contrast, this value rose 229% during President Clinton’s years. The Market declined in each of President Bush’s terms. All of us are acutely aware of recent Market losses: it has dropped 40% in a little over a year. The last eight years represent the worst Stock market performance of a Presidential administration since that of President Herbert Hoover.
Perhaps of greatest consequence to the long term health of our country is the massive debt that has been accumulated during the past eight years. Today, the National Debt stands at $10.6 trillion. $4.9 trillion of that has been accumulated during the last eight years. 46% of the National Debt has been accumulated during the Presidency of George W. Bush. In fiscal year 2008, we spent $412 billion just on interest payments on our debt. Since half of that was accumulated during the past eight years, we can thank President Bush for saddling us with these interest payments. And they will be with us for years to come.
At this point, every American’s share of President Bush’s debt is over $16,000. Every year, each of us will have to pay an additional $630 in taxes just to pay interest on the debt he has accumulated. On average, we will each have to pay taxes totaling $16,000 to eliminate this debt accumulated under this President. Where will President Bush be when we have to make this sacrifice?
We can’t know what will happen during the Presidency of Barack Obama. But as we move into this next phase of our country’s history, let’s be crystal clear on what has happened over these past eight years. Economically, it has been a true disaster. Let us all hope that better days lie ahead economically, and in all of the other aspects in which this country has been tarnished of late.
Our country faces the most severe economic crisis in three generations. Rather than working to solve these problems, President Bush has chosen to spend his last days in office in an attempt to polish his legacy.
For many, it is difficult to remember where we were eight years ago and what these years have meant to the average citizen of this country. Let’s take a look at some of these aspects of our national economy.
The Gross Domestic Product (GDP) is the measure of the total value of all goods and services produced in the country. During the eight years of the President Clinton, when adjusted for inflation, it grew at an annual rate of 3.6%. During the past eight years, it has grown 2.2% per year. When you factor in the fact that our population grows at about 1% per year, these figures become 2.6% vs. 1.2% in terms of the amount of goods and services produced, and therefore available to, each citizen.
Recessions, as defined by the National Bureau of Economic Research, are periods of reduced economic activity: GDP declines and unemployment rises. During the past eight years, two recessions have begun. During the eight years under President Clinton, there were no recessions. This has been a repeating pattern in recent years: of the past 11 recessions, 10 began with Republicans in the White House.
Despite what President Bush has said again and again, he did NOT inherit a country in recession. The recession of 2001 began five months after his election. It was also not caused by the attacks of 9/11: it began five months prior to that terrible day.
The years of President Bush have been particularly hard on working Americans. Although he will boast that three million jobs were created during his two terms, over 14 million jobs were needed just to keep up with our increasing population. This means that there was a “jobs deficit” of over 11 million during his Presidency. There has been a deficit in five of his eight years. In contrast, there were 23 million jobs created during President Clinton’s term in office, far more than the 13 million needed to keep up with growth in the work force. In every year of the Clinton Presidency, there were more jobs created than were needed to employ our growing population. In my lifetime, two Presidents have overseen periods of “jobs deficits”, and their names were Bush.
The Stock Market is also an indicator of economic growth, although it is not solely due to activities within our country: most large corporations do business around the world. During the past eight years, the Dow Jones Industrial Average has declined by 17%. In contrast, this value rose 229% during President Clinton’s years. The Market declined in each of President Bush’s terms. All of us are acutely aware of recent Market losses: it has dropped 40% in a little over a year. The last eight years represent the worst Stock market performance of a Presidential administration since that of President Herbert Hoover.
Perhaps of greatest consequence to the long term health of our country is the massive debt that has been accumulated during the past eight years. Today, the National Debt stands at $10.6 trillion. $4.9 trillion of that has been accumulated during the last eight years. 46% of the National Debt has been accumulated during the Presidency of George W. Bush. In fiscal year 2008, we spent $412 billion just on interest payments on our debt. Since half of that was accumulated during the past eight years, we can thank President Bush for saddling us with these interest payments. And they will be with us for years to come.
At this point, every American’s share of President Bush’s debt is over $16,000. Every year, each of us will have to pay an additional $630 in taxes just to pay interest on the debt he has accumulated. On average, we will each have to pay taxes totaling $16,000 to eliminate this debt accumulated under this President. Where will President Bush be when we have to make this sacrifice?
We can’t know what will happen during the Presidency of Barack Obama. But as we move into this next phase of our country’s history, let’s be crystal clear on what has happened over these past eight years. Economically, it has been a true disaster. Let us all hope that better days lie ahead economically, and in all of the other aspects in which this country has been tarnished of late.
Friday, January 9, 2009
December Jobs Report Bad – Revisions, Adjustments Make It Even Worse
The Employment Situation Summary, often called the Jobs Report, was released this morning by the Department of Labor (DOL). The numbers are bad for December. However, revisions to the two preceding month’s data make it even worse.
The headline jobs number was a loss of 524,000 jobs during December. These data are from the “Establishment Survey”, officially called the Current Employment Statistics survey, which is conducted on 150,000 businesses and government agencies. Last month, the DOL reported that 533,000 jobs were lost. However, this month’s report also includes a downward revision for each of the last two months totaling an additional 154,000 jobs. So in reality, there are now 678,000 fewer jobs that were indicated by last month’s report. During 2008, nearly 2.6 million jobs were lost.
This is the worst, by far, than any year since 1975 when the currently available data set begins. As bad as these numbers sound, in reality they are even worse. As I pointed out in an earlier post, the country needed almost 1.9 million jobs just to keep abreast of the growing population. In fact, this growing population should create this number of jobs due to increased demand. So, in fact, the “job deficit” for this calendar year is nearly 4.5 million. This is more than a million worse even than the severe recession of the Reagan Presidency.
The Unemployment Rate reported this morning was 7.2%, up from a revised 6.8% last month. The initial report from last month was 6.7%, so this month’s reading is actually 0.5% worse than last month. These data are from the Household Survey, or Current Population Survey, which is conducted on 50,000 households each month.
Many have argued that this official unemployment rate is a deceptively small number as it does not count those who have given up looking for work. A number of alternative numbers have been proposed to reflect a more accurate picture of our employment situation. In an earlier post, I explained one such alternative value, which I called the Adjusted Unemployment Rate. This now stands at 9.4%, which is again the worst since 1982 during the Reagan recession.
The headline jobs number was a loss of 524,000 jobs during December. These data are from the “Establishment Survey”, officially called the Current Employment Statistics survey, which is conducted on 150,000 businesses and government agencies. Last month, the DOL reported that 533,000 jobs were lost. However, this month’s report also includes a downward revision for each of the last two months totaling an additional 154,000 jobs. So in reality, there are now 678,000 fewer jobs that were indicated by last month’s report. During 2008, nearly 2.6 million jobs were lost.
This is the worst, by far, than any year since 1975 when the currently available data set begins. As bad as these numbers sound, in reality they are even worse. As I pointed out in an earlier post, the country needed almost 1.9 million jobs just to keep abreast of the growing population. In fact, this growing population should create this number of jobs due to increased demand. So, in fact, the “job deficit” for this calendar year is nearly 4.5 million. This is more than a million worse even than the severe recession of the Reagan Presidency.
The Unemployment Rate reported this morning was 7.2%, up from a revised 6.8% last month. The initial report from last month was 6.7%, so this month’s reading is actually 0.5% worse than last month. These data are from the Household Survey, or Current Population Survey, which is conducted on 50,000 households each month.
Many have argued that this official unemployment rate is a deceptively small number as it does not count those who have given up looking for work. A number of alternative numbers have been proposed to reflect a more accurate picture of our employment situation. In an earlier post, I explained one such alternative value, which I called the Adjusted Unemployment Rate. This now stands at 9.4%, which is again the worst since 1982 during the Reagan recession.
December Jobs Report – Unemployment Rate 7.2%, 524,000 Jobs Lost
The Department of Labor released the monthly Employment Situation Summary (often called “The Jobs Report”) at 8:30 EST this morning. In December, 524,000 jobs were lost. The Unemployment Rate stands at 7.2%, up from 6.8% last month
Wednesday, January 7, 2009
Initial Jobless Claims
In earlier posts, I discussed two important indicators of the national economy in terms of employment. The first was the monthly “jobs number”, or the number of jobs created/lost. The second was the unemployment rate. Both of these are presented by the Department of Labor (DOL) on the first (or sometimes the second) Friday of the month. The December numbers will come out this Friday.
Today, I want to look at the “Initial Jobless Claims”. This number is presented by the DOL each week: the report on each Thursday represents the data for the preceding calendar week. Tomorrow, we’ll get data for the week ending on 3 January. The number represents the number of persons who first file for unemployment compensation.
Clearly, this has some relation to the jobs number (inversely) and the unemployment rate (presented as a percentage). However, these pieces of data come from three separate sources. The unemployment rate comes from the “Current Population Survey”, also referred to as the “Household Survey”. It represents data collected on a monthly basis by contacting homes directly and posing questions about the employment status of those in the home, and is conducted by the Bureau of the Census on behalf of the Bureau of Labor Statistics.
The jobs number is constructed from the “Current Employment Statistics” survey, often called the “Establishment Survey”. It is also compiled by the Bureau of Labor Statistics. These data are collected by contacting businesses directly and posing questions about their employment situation.
The initial jobless claims number, actually called the “Initial Unemployment Claims”, is the most current employment information available. It is certainly important in its own right – it represents a large fraction of the actual number of Americans who have recently become unemployed. It doesn’t really reflect the actual number because many who do not have work do not apply for benefits, and many who have lost their job do not qualify for unemployment compensation. Nonetheless, it is a useful indicator. However, for comparisons across time, it can be misleading because it is important to view this number in light of the size of the current population and workforce. Therefore, the BLS also presents the number of workers covered under the unemployment compensation system. Using this as a base, the current numbers can be computed as a percentage, aiding comparisons across time.
So, where are we? Over the past couple of months, the weekly initial jobless claims have exceeded a half million every week except last week when they came in at 492,000. These data are the worst in over 25 years: they are the highest since the recession that occurred during the early years of the Reagan administration. However, when taken as a percentage of the number of insured workers, the data are now reaching levels that were seen during the administration of Bush-41. The recent peak was 0.44% observed week before last. A value of 0.54% was seen in the middle of 1992.
We have no idea whether we have seen the worst numbers in this current downturn. Tomorrow we will get more information. At that time, I’ll provide some more historical information, and some insight into whether the initial jobless claims can give us any insight into whether this recession is nearing an end.
Today, I want to look at the “Initial Jobless Claims”. This number is presented by the DOL each week: the report on each Thursday represents the data for the preceding calendar week. Tomorrow, we’ll get data for the week ending on 3 January. The number represents the number of persons who first file for unemployment compensation.
Clearly, this has some relation to the jobs number (inversely) and the unemployment rate (presented as a percentage). However, these pieces of data come from three separate sources. The unemployment rate comes from the “Current Population Survey”, also referred to as the “Household Survey”. It represents data collected on a monthly basis by contacting homes directly and posing questions about the employment status of those in the home, and is conducted by the Bureau of the Census on behalf of the Bureau of Labor Statistics.
The jobs number is constructed from the “Current Employment Statistics” survey, often called the “Establishment Survey”. It is also compiled by the Bureau of Labor Statistics. These data are collected by contacting businesses directly and posing questions about their employment situation.
The initial jobless claims number, actually called the “Initial Unemployment Claims”, is the most current employment information available. It is certainly important in its own right – it represents a large fraction of the actual number of Americans who have recently become unemployed. It doesn’t really reflect the actual number because many who do not have work do not apply for benefits, and many who have lost their job do not qualify for unemployment compensation. Nonetheless, it is a useful indicator. However, for comparisons across time, it can be misleading because it is important to view this number in light of the size of the current population and workforce. Therefore, the BLS also presents the number of workers covered under the unemployment compensation system. Using this as a base, the current numbers can be computed as a percentage, aiding comparisons across time.
So, where are we? Over the past couple of months, the weekly initial jobless claims have exceeded a half million every week except last week when they came in at 492,000. These data are the worst in over 25 years: they are the highest since the recession that occurred during the early years of the Reagan administration. However, when taken as a percentage of the number of insured workers, the data are now reaching levels that were seen during the administration of Bush-41. The recent peak was 0.44% observed week before last. A value of 0.54% was seen in the middle of 1992.
We have no idea whether we have seen the worst numbers in this current downturn. Tomorrow we will get more information. At that time, I’ll provide some more historical information, and some insight into whether the initial jobless claims can give us any insight into whether this recession is nearing an end.
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