June jobs jabberwocki: Unemployment through the BLS looking glass
Apparently, the experts are as confused as Alice was in Wonderland
Budget? We don't need no stinkeen' budget
Last time, part of our lede was "and it looks like June saw growth in jobs"--well, apparently it only looked that way for a minute. If you're considering filing for bankruptcy protection, you might want to read this whole post. Well, for that matter, if you have to live within a household budget, these sorts of numbers may be important for your monthly planning.
What is it economists do, exactly?
Reporting on the confounding, messy tangle that is our current unemployment scenario, CNBC's "NetNet with John Carey" jumps into the fray, with a July 11 piece:
If youre confused over high unemployment, youre not alone. The people who are best supposed to understand this issue dont have much of a clue either.
That became readily apparent following the governments release Friday of the June jobs report, a dismal data set with virtually no redeeming factors.
More than that, though, the report blindsided Wall Street and Washington economists, who expected about 100,000 jobs created last month, not the 18,000 that showed up in the Bureau of Labor Statistics compilation.
Revised revisions, revised
The article referenced in the preceding link is a July 8 CNBC news story that says not only were the June figures way off from projections but also that the feds revised downward the numbers from April and May:
U.S. employment growth ground to a halt in June, with employers hiring the fewest number of workers in nine months, dousing hopes the economy would regain momentum in the second half of the year.
Nonfarm payrolls rose only 18,000, the weakest reading since September, the Labor Department said on Friday, well below economists' expectations for a 90,000 rise.The unemployment rate climbed to a six-month high of 9.2 percent, even as jobseekers left the labor force in droves, from 9.1 percent in May.
"The message on the economy is ongoing stagnation," said Pierre Ellis, senior economist at Decision economics in New York. "Income growth is marginal so there's no indication of momentum.
The government revised April and May payrolls to show 44,000 fewer jobs created than previously reported.
The infamous Table A-15
OK, to recap, lets review the Labor Department's "Table A-15. Alternative measures of labor underutilization." Row U-3 is what's always given out as the "official unemployment rate." Well, here's the exact wording from the table: "Total unemployed, as a percent of the civilian labor force (official unemployment rate)."
Looking at the seasonally adjusted data (the right-hand side of the table), we see that the "official rate" in June 2010 was 9.5 per cent. Last month was better from the same time last year, clocking in at 9.2 per cent.
But the alarming trend is the reversal of improvement; by February 2011, the rate was down to 8.9 per cent, and it improved slightly in March 2011 to 8.8 per cent. However, by April it was back up to 9.0 per cent, then 9.1 in May. Judging from those numbers, if something does not happen to turn this around, it appears as though we could be back to June 2010 levels in three months.
Official unemployment vs. actual rate of 'out of the market'
And don't forget--as we've pointed out before, the "official" unemployment rate is not the actual rate. For that, we have to look at row U-6, captioned thus: "Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force." Cut through the doubletalk and what that means is none of these folks have a real job even though some of them might bring home some dough, occasionally, from some part-time, hit-and-miss, piss-ant endeavor and God Bless 'em for working when they can.
Plenty of good workers up for hire
The rest of 'em? No work at all. None to be had. On a personal note, let me say that I know plenty of boomers who are either out of work or scraping by in the euphemistic "underemployed" category. And, truly, it's a sinful shame: I can think of, offa the toppa, dozens of former top-notch journalists--including a Pulitzer-prize winner--I mean, these folks aren't hacks, and they're scattered hither and yon, hunkered down with the rest of us.
My personal list goes on and on: IT professionals, construction-company owners--not to mention skilled construction techs--and that list extends to the young, too. No telling how many recent graduates in other times would be young professionals in a fledgling career but instead are now doing "something other"--or nothing. Then when you consider the impact on various minorities? Well, it's not cheerful, is it?
No, it's not, and here's a cold, grey look at the black n' white numbers of "total unemployment." Click back on that Labor Department table, and peruse row U-6: 16.5 per cent in June 2010. Then, like the "official rate," it dips. By February 2011? 15.9; March, 15.7. That looks better, right?
Except in April it's back up, to 15.9 then dips again in May to 15. 8.
June? That is, last month? It's back up, to 16.2.
As mentioned earlier, the trend is not encouraging.
Next time: Changes at The Fed and one CEO's feint toward bringing jobs back home, to the good 'ol US of A.
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