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Figures...Unemployment...

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Post  News Hawk Sat Aug 03, 2013 7:47 pm


"Seasonally-adjusted, the private sector added just 161,000 new jobs in July. The federal government shed 2,000 jobs, but governments at all levels added 1,000 jobs for an overall private-public sector gain of 162,000 in July. The official unemployment rate fell to 7.4 percent.
The 195,000 seasonally adjusted jobs gain the BLS reported for June was revised to 188,000. Gains in May were revised from 195,000 to 176,000.

Figures...Unemployment... EmployJuly2013


"Today's jobs data is terrifying for Main Street," said Todd M. Schoenberger, managing partner at LandColt Capital in New York. "Despite the proactive actions from the Fed and stimulus help from Capitol Hill, the labor market remains stuck in quicksand. For Wall Street, however, this is terrific news."

If the July level of expansion continued every month at the average it has for the past nine months, it would take us until August 2021 before we reached the employment level we were at when the Great Recession officially began in December 2007. At 300,000 a month, we would return to the pre-recession level in May 2017, almost a decade from the time the Great Recession began.

You can calculate for yourself how fast the economy would get back to the pre-recessionary level by using this interactive gadget. You can also calculate how many jobs must be created each month just to keep up with growth in the working-age population with this gadget at the Atlanta Federal Reserve.

The BLS's monthly count does not distinguish between full-time and part-time employment. It also does not consider how good the new jobs are. Although they capture the overall trends in unemployment, the headline numbers that most of the media focus on tend to partially disguise the real situation. In other words, the headline numbers consistently make things look better than they actually are.

Internally, the BLS calls the official unemployment rate—the headline number—U3. But each month the bureau also calculates a more complete measure called U6 that rarely makes the headlines. Among other things, it includes Americans who work part-time even though they want full-time jobs. In June, U6 rose by 0.5 percent to 14.3 percent. It fell to 14 percent in July, according to the BLS.

The jargon for these underemployed is "part time for economic reasons," as opposed to part time by choice. U6 also covers a portion of "discouraged workers" who want jobs but have given up looking within the past year. Those who have given up looking for more than 12 months but still say they want a job are not included in the U6 count. They still need a place to live, food to eat, money for transportation and clothes, but statistically, they don't exist.

The employment-population ratio remained steady at 58.7 percent in June. The labor force participation rate fell in July to 63.4 percent. These are 30-year lows. (More about these below the fold.)

Here are the official (U3) seasonally adjusted unemployment rates in July for:

African Americans—12.6 percent
Latinos—9.4 percent
Asian Americans—5.7 percent (not seasonally adjusted)
American Indians—Not counted
Women—6.5 percent


Unemployment by race
attribution: FRED

Unemployment by race. The joblessness of American Indians is not counted
in the Bureau of Labor Statistics monthly report.

For more details about today's jobs report and some related charts, please continue reading below the fold. .




attribution: Calculated Risk
Some 37 percent of the 11.5 million people who are officially unemployed—4.2 million—have been out of a job for 27 weeks or more.


Among other news in the July job report:
• Professional services: + 36,000
• Leisure & hospitality: + 38,000
• Retail trade: + 47,000
• Financial activities: + 15,000
• Construction: - 6,000
• Manufacturing: + 6,000
• Average workweek (for production and non-supervisory workers) fell to 34.4 hours.
• Average manufacturing hours fell to 40.6 hours.
• Average hourly earnings for all employees on private nonfarm payrolls was down 2 cents from June's revised figure to $23.98.

Two other key figures, whose full meaning has engendered much dispute over the past several years as the impact of the Great Recession has reverberated across the economy, are the previously touched upon employment to population ratio and the labor force participation rate. As noted above, the employment-population ratio, which held steady at 58.7 percent in July. The labor force participation rate fell to 63.4 percent.

Some analysts attribute most of the drop in the labor force participation rate to retiring baby boomers. This drop, they say, was predicted by the BLS and therefore is not something to worry about. But BLS did not predict such a steep drop so soon. Although it's obvious baby-boomer retirement over the next two decades will change the labor force in a major way, experts like those at the Economic Policy Institute, say only about a third of the current participation drop is a result of retirements. They point out that the participation rate among Americans in their prime working years, 25-54, fell during the recession and has not returned to its pre-recession levels. That situation is something to worry about and can't be papered over with claims about changing demographics.


Employment to Population Ratio June 2013
Employment to population ratio
The drop-outs have an important impact statistically. As I wrote Wednesday:

[A]s we critics have repeatedly noted, and [former BLS Commissioner] Keith Hall now concedes, the numbers are tallied in such a way that that it's too easy for one to be considered employed and too hard to be considered unemployed. For instance, if you report to the BLS surveyors that you worked one hour a week, you are counted as employed. If you still want a job but you've been turned down so many times you've given up looking for more than a year, you aren't counted at all. You're considered out of the labor force altogether. And that skews the headline numbers.
Simply stated, if there are 1,000 people in the labor force and 100 of them aren't working, the unemployment rate is 10 percent (100 ÷ 1,000 = 0.10). But if 50 of those 1,000 job seekers stop looking for work out of frustration, they are considered no longer in the labor force, which now clocks in at 950. The unemployment rate thus falls to 5.3 percent (50 ÷ 950 = 0.53).

A rate that falls from 10 percent to 5.3 percent makes for a good headline. But it doesn't make for a good economy if those 50 drop-outs still want a job but are too discouraged by rejections to keep looking for one.
Although seasonally adjusted average monthly job growth has clocked its best nine-month run since 2005, it hasn't been enough to restore the nation to pre-recession unemployment levels. As Josh Bivens and Heidi Shierholz at the Economic Policy Institute wrote last month:

[J]ob growth in the current recovery is slightly stronger than the job growth following the recession of 2001. However, it is slower than in the prior two recoveries and is in fact slower than in any other previous recovery dating back to World War II. Furthermore, jobs fell much further and faster during the Great Recession than in any other recession over that period, meaning that we are stuck in a much larger jobs-hole four years into recovery than in any previous business cycle. The fact that four years into the recovery we still have not yet come close to making up the jobs lost in the downturn, (much less the jobs needed to keep up with growth in the potential workforce over that time), is a grimmer situation than anything our labor market has seen in seven decades.
•••
Here's what the job growth numbers looked like in July for the previous 10 years. These data have been recalculated via the BLS's benchmark revisions:

July 2003: +  20,000      
July 2004: +  37,000  
July 2005: + 372,000
July 2006: + 210,000  
July 2007:  -   35,000
July 2008:  - 216,000
July 2009:  - 351,000
July 2010:  -   86,000
July 2011: +   78,000
July 2012: + 153,000  
July 2013: + 162,000

A report by Automated Data Processing on Wednesday put the seasonally adjusted increase of private-sector jobs in July at 200,000.

A report by TrimTabs, which bases its monthly estimates on income tax deposits to the U.S. Treasury, reported Wednesday that the economy had only generated 23,000 new jobs in May.


The BLS jobs report is the product of a pair of surveys, one of more than 410,000 business establishments called Current Employment Statistics, and one called the Current Population Survey, which questions 60,000 householders each month. The establishment survey determines how many new jobs were added. It is always calculated on a seasonally adjusted basis determined by a frequently tweaked formula.  The BLS report only provides a snapshot of what's happening at a single point in time.
It's important to understand that the jobs-created-last-month-numbers that it reports are not "real." Not because of a conspiracy, but because statisticians apply formulas to the raw data, estimate the number of jobs created by the "birth" and "death" of businesses, and use other filters to fine-tune the numbers. And, always good to remember, in the fine print, they tell us that the actual number of newly created jobs reported is actually plus or minus 100,000.
.
Originally posted to Daily Kos Labor on Fri Aug 02, 2013 at 06:01 AM PDT.

Also republished by Daily Kos Economics and Daily Kos.

The answer, obviously, is to hire more Government employees!

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Figures...Unemployment... Empty Re: Figures...Unemployment...

Post  WHL Sun Aug 04, 2013 7:31 am

My question is, why are the figures always revised? Doesn't the gov. do anything right? No, don't bother to answer that.
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