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The unemployment rate actually lowered in November, while employment was virtually unchanged, as the country lost just 11,000 jobs. This is certainly as good a statistic in this category as there has been for the entire Obama presidency by a wide margin, and the best jobs month since the start of the recession in December 2007.
Still, the raw numbers should resist any call of this as good news:
In November, both the number of unemployed persons, at 15.4 million, and the unemployment rate, at 10.0 percent, edged down. At the start of the recession in December 2007, the number of unemployed persons was 7.5 million, and the jobless rate was 4.9 percent.
Among the major worker groups, unemployment rates for adult men (10.5 percent), adult women (7.9 percent), teenagers (26.7 percent), whites (9.3 percent), blacks (15.6 percent), and Hispanics (12.7 percent) showed little change in November. The unemployment rate for Asians was 7.3 percent, not seasonally adjusted.
Discouraged workers and long-term unemployed actually edged up, which may account for the decline in the overall jobless rate.
Regardless, this is a picture of an economy that still needs some help in job creation. A better decline is still a decline. A 10.0% jobless rate is still horrific. And the economy needs to produce 150,000 jobs a month, or 1.8 million a year, just to keep up with the number of new Americans entering the workforce. That is far from happening.
There’s also the type of jobs that are being created right now which should cause a bit of concern. Construction and manufacturing jobs are still falling, albeit at a slighter decline. The job creation sectors?
Employment in professional and business services rose by 86,000 in November. Temporary help services accounted for the majority of the increase, adding 52,000 jobs. Since July, temporary help services employment has risen by 117,000.
Health care employment continued to rise in November (21,000), with notable gains in home health care services (7,000) and hospitals (7,000). The health care industry has added 613,000 jobs since the recession began in December 2007.
Temp jobs aren’t much of a relief, especially in terms of job security.
The new jobless numbers are surprising and relatively good, but the statistics show that public investment remains a need for the economy. This should not be a time that words like “our resources are limited” are allowed to predominate. Instead, other lines said at yesterday’s job summit, like the idea that public funds for job creation “would be a good investment in the future,” remain completely operative.
UPDATE: Here are good words of wisdom from EPI’s Larry Mishel:
Economic Policy Institute (EPI) Director Larry Mishel says he would not interpret this decline as the beginning of a ongoing reversal in the unemployment rate. In fact, the jobs situation likely will worsen for up to the next 12 months, he says. One reason: There is a backlog of people who dropped out of labor force who will come back in—up to 3 million jobless workers. And when they start looking for jobs again unemployment will rise.
UPDATE II: Politically, the White House has to tout the numbers, but they need to resist getting ahead of themselves. This is from Christina Romer of the Council of Economic Advisers:
Today’s employment report was the most hopeful sign yet that the stabilization of financial markets and the recovery in economic growth may be leading to improvements in the labor market.
Payroll employment declined 11,000 in November. This is a dramatic improvement from the decline of 597,000 in November 2008 and 741,000 in January 2009. It is by far the closest we have been to stable employment since the recession began almost two years ago. Furthermore, the employment loss in both September and October was revised down substantially, with the result that employment as of October is nearly 160,000 higher than was reported last month. As was true in October, the largest employment gains in November were in temporary help services, which is often a leading indicator of labor demand. 21,000 jobs were also added in state and local public education. Both the work week and aggregate hours increased, another early sign of labor market healing.
The unemployment rate, which had risen to 10.2% in October, declined to 10.0% in November. This decline primarily reflects an increase in the number employed, as measured by the household survey. Despite the welcome decline, the unemployment rate remains unacceptably high. This underscores the need for the responsible actions to jumpstart private-sector job creation that the President highlighted at yesterday’s Forum on Jobs and Economic Growth at the White House.
There are many bumps in the road ahead. The monthly employment and unemployment numbers are volatile and subject to substantial revision. Therefore, it is important not to read too much into any one monthly report, positive or negative. But, it is clear we are moving in the right direction.
Tags: Barack Obama, economy, jobs, unemployment
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a long quote from a much longer post at billy blog (a must read on progressive economics and employment policy):
……………………..
I was interested in yesterday’s release of a jobs plan by the Washington-based (progressive) Economic Policy Institute.
As an aside, I am always bemused when some “progessive” or otherwise so-called think tank comes up with a “bold new plan” that is modest in its reach and fails entirely to recognise that there has been substantial research and policy design by modern monetary theorists on the design and operation of employment creation plans.
Do these people reject our broader employment guarantee proposals? If so, why don’t they at least engage with them rather than holding out that they are proposing something that hasn’t been really examined in any detail before?
These “new bold plans” are in fact pale attempts at addressing the problem. For example, I consider that the EPI’s American Jobs Plan, which aims to create at least 4.6 million jobs in one year, fits into the league – no recognition of past work by progressive economists who have been pushing these issues for years.
Anyway, who would get the 4.6 million jobs?
On page 15, the EPI say that:
The US Bureau of Labor Statistics provides the following breakdown of unemployment (thousands) by duration for October 2009:
Less than 5 weeks – 3,147
5 to 14 weeks – 3,717
15 weeks and over – 8,834
15 to 26 weeks – 3,240
27 weeks and over – 5,594
So the scheme will not even provide enough jobs for those who have currently been unemployed for 27 weeks or over and the flows into that pool will expand over the course of the program.
If you read the EPI report you understand how costly and damaging unemployment is. If that is so, then why – especially if you claim to be a progressive think tank (to quote Krugman) – limit your policy response to 4.6 million jobs when you have 24.5 million unemployed?
Krugman wants us to get back to full employment. Then why advocate partial plans like this.
So why? Well you can guess why. They are scared to bejesus of the deficit impact.
On page 18 of the EPI report where they examine “how the US would pay for the scheme” we read that:
The terminology – “appropriate to address the federal budget deficit” – gives the game away. As if it is a policy target in itself. MMT tells you that the dollar deficit outcome or the deficit as a percentage of GDP or as some index relative to Mount Everest – whatever – these calibrations should never be a focus of macroeconmic policy.
What the government has to focus on and measure accurately is the real state of the economy and the rate of growth of nominal demand relative to real capacity.
The progressive goal should be always to advocate and create full employment. That is the position that maximises material welfare. Whatever deficit that is associated with that level of output is what it will take. That deficit outcome is neither big nor small – it is the appropriate fiscal injection.
Under some circumstances that “appropriate” budget outcome could be a surplus (for example, when there is a strong net export contribution to GDP growth). But these situations will be rare.
Further, why is the EPI advocating budget neutral outcomes for the scheme between years 3 and 10? What is the basis for that suggestion? I suspect it just reflects fiscal conservation which is just another own-goal for the progressives. In doing so, they become part of the problem.
The EPI is also advocating a tax credit along the lines proposed by the CEPR – Please read my blog – The enemies from within – for a critique of this idea.
You might also want to read the ILO Jobs Pact which is largely sound but doesn’t emphasise direct job creation enough and when it does suggests they should be temporary schemes only. I fundamentally disagree with that because I know from dealing with the ILO directly that it is based largely on a deficit-dove view of the world. They also struggle with an appreciation of MMT.
Conclusion
In the blog – The enemies from within – I argued that progressive positions that accept the constraints put on policy by the fiscal conservatives, who fail to understand how the modern monetary system operates are doing that side of the debate a dis-service and really undermining the prospects for the supposed target groups (the most disadvantaged citizens among us).
I think that these responses are probably more damaging for the creation of the true full employment and equity than those which come from the so-called right. But then when it comes down to it, the deficit-dove progressives are hard to distinguish from the right.
……………………..
For those who are still unemployed, there’s no reason you have to give up your luxury American lifestyle:
Do it at Home, America!
(satire)
Come on: These numbers will be used for all they are worth by Republicans. And I mean by Republicans both in and out of the Obama administration.
I predict that an 8 to 10 percent unemployment rate will now become the new “normal”. And I predict that unless progressives are able to somehow yank “the masses” away from both BeckWorld and pop culture, not a fucking thing will be done to change it.
Alas, the future looks gloomier the “brighter” things get today.
Really, I try mightily not to be cynic. Maybe I should call myself a “realist” instead.
imo our first job is to yank ourselves away (in the intellectual sense) from the economic policies of the democrats and associated think tanks, etc — which are primarily conservative and/or pro-corporate — and start paying attention to some actual progressive economists.
The unemployment numbers are not as rosy as CNBC has painted them.
For instance, you may want to take a look at what the numbers really show in this article
http://keepamericaatwork.com/?p=5730
Virgil
http://www.KeepAmericaAtWork.com
Uh-oh! The unemployment rate got better!
Hmmm … let us see how the loopy “progressive” posters @ FDL try to spin this as an obvious need to drop more $$ into the govt for job creation …
Job losses have slowed to almost a HALT since Obama took office.
Yet FDL libs still whine & complain that he’s not “progressive” enough.
Well, then don’t vote for Obama in 2012 and we’ll all get stuck with Pres Palin, Romney or Pawlenty.
Greaaaaaat …
EPU: Here is a link to article discussing some of the tax issues if nothing is done in estate tax area before year-end. Lots of loopholes if nothing is done, in my opinion.
http://bx.businessweek.com/entrepreneurship/view?url=http%3A%2F%2Festatetaxchanges.blogspot.com%2F
what’s the down side of job creation and full employment?
What with the administration’s Hoover-like approach to the economy and the awful decisions about escalating in Afghanistan and increasing drone attacks, denying basic civil liberties and screwing up the health care reform, it really is time for progressives to show their anger in more visible ways. We had hoped for a progressive President. We don’t have one. We need a game plan to pressure the President and Congress to do a better job representing the people who elected them. Wish I knew the answer.
For employers, the downside would be higher pay for employees.
Jane has a fresh cross-post ready: “Ha Ha. Fuck You, Harry Reid. Kicking Your Ass is Going To Be Fun.”
and why would that be a problem?
(not sure your premise is true, but will put that aside for the moment)
What’s the downside to having a natl debt that is approaching 100%+ of GDP?
THe devaluation of the U.S. dollar, weakened U.S. global credit standing and increased reliance on the Chinese.
fed gov spending is not economically constrained by tax collection or by borrowing. the size of the deficit is not an issue, inflation could be. but at this point of massive under utilization of labor, how would spending wisely to create full employment cause excessive devaluation of the dollar? (we depend on the dollar’s reserve status, but not foreign lending).
i highly recommend billy blog to you (link above)
Not a problem for employees, but in the current environment, employers get their pick of desperate job-seekers, who would, under a full-employment scenario, would be demanding higher pay. Now, they take what they’re offered.
barack needs to either replace larry summers and rahm emanuel or get them with an aggressive program to bring jobs back to main street and strengthen the middle class not the investor class.
nope. read billy blog. he and randall wray, warren mosel and a bunch of others, some working off of the ideas of minsky and some independently, understand how to have full employment with price stabililty — the labor buffer stock. if you are really interested, i highly recommend randy wray’s book, understanding modern money, the key to full employment and price stability.
progressive economists rock. too bad there are so few of them. but that’s no reason for us to ignore them.
It is irresponsible to report as fact the figures the government gives out for unemployment figures. They have not been correct in the last 2 years, and a further report that comes out in the next couple days will contradict the report they use today.
Does no one remember how many times that the two or 3 different reporting agencies have differed on these reports? In the last 2 years, these reports have never agreed, and the rosy colored half full glass has turned out to be an old cup that is more than half empty.
You are reporting bullshit government propaganda as though it were fact Dave, what’s up with that? The job losses are continuing and every state reports declines, but only in the fantasy world of the beltway do they equate increases in jobs with the stated losses reported to them by the states.
What are you on about?
I have a favor to ask of you. It will take about 5 minutes. Call your Senators, and even Republicans on this one, and ask them to vote No on the reconfirmation of Ben Bernanke as chair of the Fed.
Yesterday’s testimony proved beyond a doubt that he is not competent to continue in his position.
It’s not the data that is bogus, it’s the assertion that less bad constitutes good. It is technically improvement. But that takes a special parsing and does not reflect the reality that folks are experiencing.
Moreover, the happy talk (not the data) provides aid and comfort to the fiscal scolds (and Ben Bernanke), who are indeed in the Wall Street-DC Beltway bubble.
Been there, done that. I’ll just wait for the revised numbers, thank you very much.
Anything that happened in the job market has occured despite Obama’s policies not because of them. Rescuing Main Street was never the focus of his economic team. And look at the jobs that are being created. They pay a lot less and the job security folks have holding them is minimal.
Wall Street wants a new “normal” unemployment rate at between 8 and 10 percent. Why? Because it gives employers more leverage when negociating wages and benefits with employees.
And with Obama they will get it.
Obama is Bilderberg through and through. And if you don’t understand what that means for working and middleclass folks in America google Bilderberg and find out.
Bilderberg is such a, by force of fact, clandestine description. DLC, or Centrist, or Corporatist works just fine.
No, a lower unemployment rate and losing 100,000 fewer jobs than expected is in fact good news.
That’s not to say “Mission Accomplished” or anything, but it is good news.
There are ways of reducing the deficit (and debt) without destroying jobs. Taxes on financial transactions is one. Restoring the tax rate structure that existed in 1954 is another. Cutting military spending on non-Iraq and non-Afghanistan items to cover the costs of those wars is another.
The fact is that at the moment, the debt is financed at relatively low interest rates. And a substantial part of the deficit is coming from war and the loss of revenue due to the Bush tax cuts and current unemployment.
Yes those are downsides, but moving to deal with unemployment will cause our creditors to have more confidence in our ability to pay. Pursuing draconian austerity will drive the economy deeper into a hole and reduce our ability to pay off those debts — and even cause political instability that could endanger their receiving anything at all.
The fiscal scolds have a very simple-minded argument. Those who pretend to be economists among them should return their degrees.
Riiight … everything is Obama’s fault. And that $800B bill to push funding into state projects has absolutely nothing to do with employment.
Do you happen to get all of your deep introspective financial insights from Fox Business News & CNBC ? … LOL!
Well said … but as unemployment moves back to 8-9% in 2010, should put as levels that the Chinese and other holders of our debt are comfortable with.
Personally, I would like to see more military cut-backs in Iraq sooner than mid-2010 and the HCR changes to take effect sooner.
Those alone will help with the deficit, but not cut it enough.
I am worried that we’ll see tax cuts for businesses and capital gains, which will have the same effect of raising our deficit by cuttting our revenues.