US loses 95,000 jobs in September

[Hannah Bell]

The US shed 95,000 more jobs in September, up from 57,000 jobs lost in August and the fourth straight month of net payroll reduction, the US Department of Labor reported on Friday.

The combined job losses for July and August were also revised upward by 15,000. Separately, the Bureau of Labor Statistics said it will revise upward the number of job losses by 366,000 for the year lasting from March 2009 through March 2010.

The official unemployment rate held steady at 9.6 percent only because a larger number of workers than expected stayed out of the labor market. September was the 14th month in a row with an unemployment rate over 9.5 percent, the longest such span since the Great Depression.

A broader measure of unemployment, including the involuntary part-time and those who have stopped searching for work, rose sharply to 17.1 percent, the second-highest reading on record. The labor participation rate—the share of the eligible population working or looking for work—remained virtually unchanged at 64.7 percent, near lows not seen since the mid-1980s.

http://www.wsws.org/articles/2010/oct2010/econ-o09.shtml

[TexasObserver]

1. The loss was in government jobs. Private sector jobs increased 64,000.

As I've said all year, we need a second stim package, a trillion dollars, with infrastructure rebuilding and a related jobs program. As private sector jobs increase, the effect on government jobs should be positive.

We're still a long way from being fully recovered, but the recovery is progressing at a pace that is to be expected. We are recovering from the worst economy since the Great Depression. Expecting it to be well now is premature.

The DOW closed above 11,000 Friday, an increase of 65% since the index hit bottom in March of 2009.

We should see stronger job performance the next three months.

[Hannah Bell]

2. is that supposed to make a net loss better somehow? that they were government jobs?

who gives a shit about the fucking stock market?

[TexasObserver]

3. That's supposed to shed light and knowledge on your weak source's spin.

Whether you understand the importance of the stock market doesn't change its importance.

Who cares about the stock market? Anyone who has any understanding of US economics, that's who.

[Hannah Bell]

4. my knowledge is: it goes up when jobs go down. the majority of americans have no stock.

[TexasObserver]

5. Your "knowledge" isn't always right, as in this instance.

The fortunes of most Americans are tied to the long term trends in the stock market, whether they own stocks or not.

Stocks are assets owned by pensions, retirement programs, companies and individuals. When they go up in value, the net worth of each of those increases, which means they can convert their holdings to more cash than they could when stocks were lower. They can borrow against such holdings, and borrow more than they could when the stocks were lower. This in turn creates more spending, which helps create jobs. It's a long, slow process that anyone with any knowledge of economics expects to be a long, slow process.

Those who have either a 401K or a pension plan can see the difference in a rising stock market and a falling stock market.

The meme "the stock market goes up when jobs do down" is simply untrue. You might as well say "the stock market goes up when the wind is out of the east." It would be just as valid.

Simple views of the economy - such as "the stock market goes up when jobs do down" - are both simple and wrong.

[Hannah Bell]

13. most people don't own stock; not through a retirement program, or pension, or 401k.

Investment Assets

Top 1 percent, Next 9 percent, Bottom 90 percent

Financial securities: 60.6%, 37.9%, 1.5%
Trusts: 38.9%, 40.5%, 20.6%
Stocks and mutual funds: 38.3%, 42.9%, 18.8%


"Recent data released by the Federal Reserve shows that nearly half of all U.S. households are stockholders."

In 1998 it was 48.8% of households, with the majority held by the top 10% of households.

http://www.house.gov/jec/tax/stock/stock.htm


concern with the stockmarket is an obsession of the top 20%, the upper-middle & the upper class, not the majority.

[TexasObserver]

17. "Own" is the key word in your response.

One doesn't have to own anything in the stock market to have their pension fund or retirement affected by it.

You're right about one thing. A majority of people are very ignorant about the role of the stock market.

While you may not be concerned about the stock market, you should be.

[bherrera]

19. Maybe the debate is not on course

The stock market is important, but the question should also be, does the stock market valuation reflect the company earnings, or are the prices inflated? There may be too much money in the USA seeking a return. This is true of the retirement funds, and also of the small retired investor, and the person saving for retirement, etc.

The US dollar is losing value versus the euro, because of the perception that the US deficit is too large, and this will weaken the US currency in the future.

I can also observe it is good if the government loses workers, because this allows government to reduce expenses. And if the government is having a deficit, then it is good to reduce this deficit. Therefore you should not wish for an increase in government workers if the government doesn't have the money flows to pay these guys.

Long term, the USA does have to control the deficit, which will allow it to battle with China. And this requires less emphasis on the military spending, which is a huge waste of money. USA troops in Iraq and Afghanistan are bleeding the nation to death, and you guys can not recover unless you bring them home very soon.

[TexasObserver]

20. The deficit should not enter into the discussion until employment improves markedly.

The fact that the dollar is losing ground against the Euro is not the major concern. In fact, it makes US exports more attractive and makes imports less competitive with home grown goods. You act as if the declining USD is a bad thing. That's the point of view of those who hold US dollars or US securities. The reality is that a declining dollar makes it easier for the US to pay its debt, because we are paying it with cheaper dollars than we borrowed. China and Japan take that hit.

The major concern is JOBS. We need more jobs, and government spending is the best way to get there - deficit spending. Reagan never balanced a budget or even came close. GHW Bush never balanced a budget and never came close. And Jr. Bush damn sure never came close to balancing a budget. The only presidents to balance a budget the past 40 years were Carter and Clinton.

So, let's dispense with the "we have to address the deficit" meme. As I have stated, we cannot cut spending enough to make a dent in the budget shortfall. The only way to reduce the deficit is to increase tax revenues, and there are only two ways to do that. One is to increase taxes for the top income brackets. The other is to grow the economy until JOBS are up significantly, which will produce sufficient revenues to cover much of the current shortfall. When unemployment is below 6%, there is a reasonable chance to balance a budget, but it can only be done in good times, not bad ones.

As for the stock market, of course it doesn't reflect earnings. It reflects current perceptions of value, whether they are based upon dividends or growth potential or misinformation.

As for government workers, you're wrong there. We want more government jobs, funded by deficit spending, because jobs mean income to citizens, and that income rolls over many times in the economy, with governmental units gaining revenues correspondingly across the board.

I agree with you about the wars. They're a complete waste of our money, and are a primary reason we're in this mess. We cannot afford them.

[Hannah Bell]

24. that figure includes all forms of "ownership," including the things you mention. most people DON'T

HAVE A PENSION FUND.

[treestar]

18. To anyone who claimed the gains earlier in the year were

"just because of the census" and not the private sector? Yep, there is a feeling that private sector jobs are a better sign of recovery.

[Selatius]

6. The DOW isn't necessarily reflective of the wider economy.

You're talking about an index that only houses 30 companies. On top of that, historically low interest rates is making it easy to borrow out to the hilt and hedge on stocks, which invariably distorts stock prices upward. The S&P 500 is a better barometer of the economy overall relatively speaking, but I'm just saying...

[TexasObserver]

7. It's reflective of stock market confidence in general.

It goes without saying that no one indicia is "necessarily reflective of the wider economy," but the DOW is one important indicator which business leaders and investors follow and find useful.

Please reread my posts and garner the full range of my comments, instead of acting as if I stated the DOW is the sole determinant of the state of the economy.

Would you agree that it's better for the DOW to be above 11,000 than it is to be below 11,000? It's a pretty simple concept. The higher the number, the better effect for the economy in general.

[Selatius]

8. To answer the question, no.

If the DOW is simply above 11,000 because another speculative bubble is forming, it's decidedly not a good thing, and until a full regimen of reforms is instituted beyond what Congress did as far as reigning in derivatives go or even the reinstitution of Glass-Steagall, my stance has been and will continue to be one of caution as far as the nominal value of the DOW.

[TexasObserver]

9. Thank you for revealing your point of view.

I don't find it instructive or likely.

If you want to believe it is a bubble, that's your right.

Were you one of those guys who thought the DOW would drop below 6000 last year?

Are you one of those guys who thinks the DOW is going to have another big drop in the next year?

[Selatius]

10. I actually stopped going short after it fell below 7,000 at the end of 2008/early 2009.

I knew once they pumped in 700 big the situation would stabilize to a certain degree. As far as 11,000 goes, I generally think it's mildly high, not that I expect a huge crash but that if interest rates come off the floor, that it would kick down the index a bit once it becomes costlier for people to borrow.

[TexasObserver]

11. It only fell below 7000 one week, briefly in March of 2009, never in 2008.

See this graph:
http://bigcharts.marketwatch.com/charts/big.chart?symb=djia&compidx=aaaaa%3A0&ma=0&maval=9&uf=0&lf=1&lf2=0&lf3=0&type=2&size=2&state=8&sid=1643&style=320&time=10&freq=2&nosettings=1&rand=8835&mocktick=1&rand=7937

It's been trending up for 18 months. That's better than the alternative.

I believe the indices will be up at year's end, with the DOW above 11K.

[Selatius]

14. Yeah, it was brief, that much I remember. The exact timeline I am hazy on.

But I went long in most decisions since then, but to be frank, I'm hugging metals right now and playing it very conservative.

[TexasObserver]

15. I always play it very conservative.

I'm strictly a long term thinker on economics. I don't believe in jumping in and out, or jumping around among stocks much. I like a hedged port folio that counts on a steady rise as the market gets better. I'm most concerned about preservation of capital, not return on investment in the short term.

I got out of equities in early 2008, and didn't get back in until March of 2009.

I don't think much of investors who jump around like a frog in a frying pan. To me, that's just glorified gambling, not investing.

I don't think it matters if one is more comfortable in metals than stocks. The point is to find an approach that works for you, whether it works for others or not. I wouldn't dream of playing bonds or currencies, although both have potential for the person who studies and understands them. Each person should a plan that works for them. Some people need a dividend stream. Some people can afford to take long shots.

[Imajika]

21. The private sector job increase of 64,000 isn't good either...

That number is pretty terrible. We'd need 100k just to keep up with new workers entering the market.

The jobs report was awful any way you look at it.

Job losses in the government sector are only heralded as a good thing by the right wing. During a deep recession, government at all levels should be hiring to get the economy moving again. This report shows just the opposite is happening. Bad jobs report is bad.

[TexasObserver]

22. Yes, it is good - because it comes at the beginning of the fall.

After the summer hires are gone, and before the Christmas hires are made.

Certainly, gaining 100,000 jobs would be better than gaining 64,000, but that begs the question. There were gains in the private sector, and that's better than losses.

You're welcome to put your negative shine on it, however.

[MadHound]

23. The fact of the matter is that our economy lost jobs,

95,000 jobs as a matter of a fact. It doesn't matter that 64,000 jobs were created in the private sector. In a consumption based economy, where the economy is fueled by people buying goods, a 95,000 hit on employment means that that many more people will be buying that much less in the way of goods and service, which will continue to drag the economy tremendously.

Trying to put some sort of positive spin on this number by stating that 64,000 jobs were created in the private sector is virtually meaningless, the buying power of those new hires is way more than offset by those 95,000 net job losses.

Furthermore, none of this takes into consideration the fact that you need approximately 125,000 jobs created each month to keep up with the expansion of the work force. So if you add the two, 95,000 and 125,000, you wind up with an economy that fell 220,000 jobs short of the amount needed to simply keep up with work force growth.

In addition, the U6 number went up again this month. The U6 counts it all, jobs lost, discouraged workers who stopped looking for a job, the underemployed, all of it. That number went up from 16.7%-17.1%, a pretty hefty one month jump.

There is no way to conceivably, truthfully spin this as some sort of positive. Job losses are going to continue to hinder any sort of recovery. What is needed is a massive WPA style jobs creation program. Let all the Bush tax cuts expire, take on trillion of that savings and put it into such a program, and put the rest towards paying down the national debt, which is another drag on our economy.

[Imajika]

25. This jobs report just can't be spun as good....

I know your trying, and I suppose I admire your efforts, but it just wasn't a good report.

We had a net loss of jobs, the private sector jobs we did add are not anywhere near enough to cut the unemployment rate, the underemployment rate rose, and people are still either dropping out of the workforce or not bothering to enter. It's just bad.

The best you can say is that it could have been worse. The problem is, it might be next month if you believe Gallup's survey.

[grahamhgreen]

12. We MUST get out of NAFTA, GATT, and the other job offshoring agreements

Until we adress those, we will not get our jobs back

[TexasObserver]

16. I certainly agree with you. We need a major jobs program, too.

I favor a second stim package of a trillion dollars. I don't give a damn about the deficit. It cannot come down until we have much higher employment. There can be no balanced budget as long as unemployment is above 6%. It's not possible.

[Zax2me]

26. I'd like to see jobs be more of a priority

Not only for Obama, but for congress as well. We haven't had any good job news in awhile.
Maybe after the elections...