Unemployment now stands at 9.5%, up from 9.4%

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cat233's picture
cat233
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Posts: 575
Unemployment now stands at 9.5%, up from 9.4%

Lousy Data in Every Respect:
Not good. Nonfarm payrolls fell 467,000 in June. This is worse than an expected 367,000 and still well above the largest decline registered in the 2000-2001 recession of 325,000.

Optimists had hoped that the trend toward smaller declines would produce a decline of about 300,000 this month -- but companies do not hire/fire based on such trends.

Further large payroll declines are likely. Until weekly unemployment claims drop below 400,000, payrolls are going to continue declining. (This morning, unemployment claims for the week ended June 27 were reported at a still very high 614,000.)

Further bad news is included in the payroll report. Average weekly hours fell to 33.0 from 33.1. Hours tend to lead payrolls and the fact that employers are cutting back hours suggests that hiring is a long ways off.

Also negative from an economic standpoint is that fact that hourly earnings in June were flat. This is below an expected meager 0.1% gain and indicates that consumer purchasing power is falling (when combined with lower payroll levels).

This report is quite bad across the board. It could undermine the belief that economic recovery is not too far off simply because a slew of recent data had shown a "slower rate of decline."

The unemployment rate was up only 0.1% to 9.5%. This smaller gain was due to fluctuations in the labor force that had also produced an outsized unemployment rate jump last month. The unemployment rate will likely pop up further over the next several months.

source: briefing.com

DrKrbyLuv's picture
DrKrbyLuv
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 1995
Re: Unemployment now stands at 9.5%, up from 9.4%

cat233 - the crazy thing is that we really don't know how much the government skews the numbers.  According to Shadow Statistics, the unemployment rate is much higher:

Larry

Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2606
Re: Unemployment now stands at 9.5%, up from 9.4%

Hey Larry - tiptoeing back in until the cretins come back......

One comforting thing to take away is that the slopes of the lines are nearly identical.  "Lies, Damn Lies and Statistics" are what moves the intercept points.

I'd be a little more concerned if the plots converged or diverged - that would indicate some real book cooking as opposed to different assumptions about data presentation.

mainecooncat's picture
mainecooncat
Status: Gold Member (Offline)
Joined: Sep 7 2008
Posts: 488
Re: Unemployment now stands at 9.5%, up from 9.4%

Good point, DIAP.

Though on some of William's graphs lines do converge (or at least move in a non-parallel manner), especially if you go back further than 1994 where the above graph ends. In fact, I was just thinking about this very point and then noticed the convergence just the other day. Will look for that graph now.

DrKrbyLuv's picture
DrKrbyLuv
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 1995
Re: Unemployment now stands at 9.5%, up from 9.4%

Hello all,

Here's a link that explains some background on govt employment and unemployment numbers.  As far as his math, you have to be a subscriber to download the excel spreadsheets.  Other than that, I don't know if he explains his math.

The parallel graph seems to be the exception rather than the rule.

Larry

mainecooncat's picture
mainecooncat
Status: Gold Member (Offline)
Joined: Sep 7 2008
Posts: 488
Re: Unemployment now stands at 9.5%, up from 9.4%

Hey Doc,

After my previous post I remembered that it was you who had posted the particular graphs I was thinking of. Though still couldn't find the exact post where you did so. I thought it was a Williams' graph beginning in the early eighties, but maybe I'm mistaken. In any case, thanks for the above info.

Subprime JD's picture
Subprime JD
Status: Platinum Member (Offline)
Joined: Feb 17 2009
Posts: 562
Re: Unemployment now stands at 9.5%, up from 9.4%

Gov claims 465,000 lost in June. Real number probably around 600,000. May reported as 345,000, real number at 500,000. over a million every 2 months lose their jobs. Credit card defaults, mortgages, car loans, student loans, consumption falls, the spiral continues until a floor hits. I hate to say it but every job lost means more debt liquidated on the private sector balance sheet. Too bad the gov just adds the leverage on to the public's balance sheet. There is no gain unfortunately.

SagerXX's picture
SagerXX
Status: Diamond Member (Offline)
Joined: Feb 11 2009
Posts: 2252
Re: Unemployment now stands at 9.5%, up from 9.4%
bearmarkettrader wrote:

I hate to say it but every job lost means more debt liquidated on the private sector balance sheet. Too bad the gov just adds the leverage on to the public's balance sheet. There is no gain unfortunately.

Yeah -- is there in fact any deleveraging going on when the debt merely moves from the private to the public column?  I'm actually asking -- I'm not edumacated enough to know.

Viva -- Sager

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