Back to work?

Hard to believe that news of double-digit unemployment could be considered good news, but in this case it really is.  The standard unemployment rate edged down from 10.2% in October to 10.0% in November; the number of jobs fell once again, but by 11,000, by far the smallest decline in about two years.  Consensus forecasts had been for a slight uptick in the unemployment rate and about 150,000 jobs lost.

By one measure, this news from the BLS (Bureau of Labor Statistics) is even better than that.  The 11,000 figure is from the BLS’s survey of employers (i.e., “establishments,” “nonfarm payroll employment”), whereas the BLS does a separate survey of households, which shows an increase in employment of 227,000 and a reduction in unemployment of 325,000.  (See Table A in the BLS report.)  I’m guessing the reason that the administration and the media did not trumpet the household data is because those data are considered less reliable than the establishment data.  Still, they’re not worthless, and they are the basis of the unemployment rate figures.

President Obama correctly notes that we’re still not out of the woods yet.  The unemployment rate is still about double its normal “full employment” level.  The BLS’s alternative measures of the unemployment rate are always worth a look, and they show that the labor market is not only still deep in the woods but in some respects not improved at all:

  • The long-term unemployment rate was slightly higher in November than in October (5.9% using the standard seasonally adjusted (SA) figure, 5.6% using the non-seasonally adjusted (NSA) figure).
  • The most comprehensive measure of unemployment and underemployment, the U-6 unemployment rate (which counts all unemployed plus discouraged job-seekers plus involuntary part-timers), is still extremely high:  17.2% (SA) or 16.4% (NSA).  The SA figure fell from 17.5% to 17.2%, but that seems to be the seasonal adjustment factor at work.  The NSA figure, which corresponds to actual people without any such adjustment factor, was actually slightly worse in November, rising from 16.3% to 16.4%.

With roughly one-sixth of the potential labor force either jobless or underemployed, this is no time to declare victory and withdraw on the job-creation front.  Nate Silver argues persuasively that the case for a strong federal jobs bill is a strong as ever.

Advertisements

Tags: , ,

2 Responses to “Back to work?”

  1. democommie Says:

    Ranjit:

    Not to be a wet blanket, but are the “new” employment figures for real jobs or seasonal work for the Variously Designated Winter Solstice Holidays?

  2. ranjit Says:

    Actually, the numbers are adjusted for seasonal work. The BLS puts out two sets of numbers, one seasonally adjusted (that’s the 10% figure) and one not (that figure is 9.4%). Both are down slightly from the month before.

    I’m hardly jumping up and down about the numbers, though. As I noted in the second-to-last paragraph, the all-inclusive U-6 unemployment rate actually got a bit worse last month, even *without* adjusting for all those seasonal jobs.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: