Job losses continued in December, disappointing many who were expecting a small number of job gains.
From the BLS Employment Situation Summary
Nonfarm payroll employment edged down (-85,000) in December, and the unemployment rate was unchanged at 10.0 percent, the U.S. Bureau of Labor Statistics reported today. Employment fell in construction, manufacturing, and wholesale trade, while temporary help services and health care added jobs.
The Washington Post adds:
The unemployment rate was unchanged at 10 percent, the Labor Department said. Forecasters had expected zero net change in the number of jobs on U.S. payrolls, and some had had expected job growth to return. Those expectations were dashed by a report that — while not without bright spots — suggested that the long slog toward an improved labor market continued in December.
Also, it is interesting to note that more media outlets seem to be talking about U6. Here is an excerpt from The Wall Street Journal:
The U-6 figure includes everyone in the official rate plus “marginally attached workers” — those who are neither working nor looking for work, but say they want a job and have looked for work recently; and people who are employed part-time for economic reasons, meaning they want full-time work but took a part-time schedule instead because that’s all they could find.
Here is Table A12, showing U3 vs. U6:
Calculated Risk offers this interesting chart of the Employment-Population Ratio, which represents the percentage of adult Americans who are employed, noting:
The general upward trend from the early ’60s was mostly due to women entering the workforce.
The Labor Force Participation Rate fell to 64.6% (the percentage of the working age population in the labor force). This is the lowest since the early 80s.
When the job market starts to recover, many of these people will reenter the workforce and look for employment – and that will keep the unemployment rate elevated for some time.
One last piece of the puzzle to consider is one of the most controversial factors used to calculate unemployment: the Birth/Death Model (for businesses, not people).
Nobody does a better job explaining the BLS Birth/Death Model than Mish.
Earlier in the week, Mish presented:
Birth Death Model Revisions 2009
That bottom line in numbers is in thousands. It represents the net number of jobs the BLS adds to the payrolls every month due to the birth and death of businesses.
Somehow, in spite of the deepest recession since the great depression, with personal and corporate bankruptcies soaring, the BLS assumed an average gain of 107,000 jobs a month since February due to net business expansion.
That is how ridiculously distorted the jobs data from the BLS is every month.
Massive Revision Coming
There will be a massive revision in February (starting with the January 2010 data), but we still have to suffer through one more month of sheer BLS nonsense this Friday when the December 2009 jobs data is reported.
