What to say about today's unemployment announcment?
Good news, for sure. Great news ... hmmm.
Ron Fink pointed out to me this morning a seldom-seen chart that adds some graphic perspective to what's happening. It's worth clicking on: you can see just how deep this joblessness runs relative to previous recoveries (in 1948, 1952, 1958, 1960, 1964, 1979, 1980, 1981 and 2001). This curve is way different from the others.
Yet almost every headline on the 10 percent number from the government I see today is upbeat. "In a Surprise, U.S. Jobless Rate Eases," says the LA Times and from the NY Times we have "U.S. Economy Lost Only 11,000 Jobs in September." The WSJ plays it straighter: "Unemployment Declines to 10 Percent."
But then it adds a rundown of big-economist reaction under a headline that says, "'Game-Changer' Jobs Report," which is overstating it if you peruse some of the commentary in the text of that file. Cribbing from the list, we have Joseph Brusuelas from Moody'sEconomy.com uttering these dread words: "The labor market is still shedding jobs at a brisk clip and the unemployment rate will climb again next month, continuing its rise toward a likely peak of 11 percent."
His view only heightens my fear that this 0.2 percent drop in unemployment may be nothing more than seasonal hiring by big-box stores like Wal-Mart and Target, not quite the kind of jobs that fuel a recovery or put us on any sort of course toward a fundamental redesign of the job market (talking here about creating good high-tech jobs to replace all the manufacturing ones we've lost).
Paul Ashworth at Capital Economics throws this cold water on the party: "The bottom line is that five months after the recession ended, the economy is still shedding jobs. Tight credit conditions, uncertainty about the economic outlook, state level fiscal tightening and strong productivity growth are all holding back job creation. None of these factors are likely to fade any time soon, suggesting that the labor market will continue to be this recovery's Achilles heel."
Steven Blitz of Majestic Research focuses on what he calls "one unfortunate statistic" in the report: "The percentage of unemployed that have been out of work 27 weeks and longer jumped to 38.6 percent while the group unemployed less than five weeks dropped to 18.2 percent. In other words, while the employment picture is brightening, the economy is still far from bringing down the longer-term unemployed. It will happen at some point but once these people get back to work they will likely spend a lot more on rebuilding lost savings than on buying new stuff."
Goes without saying the sooner we can get several million jobless people back to work the better. On a not entirely unrelated note, George Clooney's new movie is getting big crowds and rave reviews. It's about a suit who works for corporations who hire him to tell people they're being terminated.
Wonder why that would be a popular theme.