Christina Romer: On the December Jobs Numbers

[ProSense]

On the December Jobs Numbers

Posted by Christina Romer

Today’s employment report, though a setback from November, is consistent with the gradual labor market stabilization we have been seeing over the last several months.

Payroll employment declined 85,000 in December. To put this number in perspective, employment declined 139,000 in September and 127,000 in October. So, in a broad sense the trend toward moderating job loss is continuing. This trend is particularly obvious in the quarterly pattern: average monthly job loss was 691,000 in the first quarter of 2009, 428,000 in the second quarter, 199,000 in the third quarter, and 69,000 in the fourth quarter.

Revised data now show that employment increased 4,000 in November. This is obviously welcome news and the first employment increase in 23 months. Compared with the unexpectedly good report for November, December’s job loss is a slight setback. Two industries where employment declined significantly were construction (-53,000) and wholesale and retail trade (-28,400). One continuing sign of labor market healing was that temporary help services, which is often a leading indicator of labor demand, added 46,500 jobs in December. Both the work week and aggregate hours remained stable, maintaining the significant improvement that occurred in November.

The unemployment rate remained at 10.0 percent in December. This level reflected a proportional decline in the number of people unemployed and the number of people in the labor force. The unemployment rate remains unacceptably high, which underscores the need for responsible actions to jumpstart private-sector job creation.

As the President has said for a year, the road to recovery will not be a straight line. 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. It is essential that we continue our efforts to move in the right direction and replace job losses with robust job gains.

[backscatter712]

1. I'm hoping today's numbers is just data noise...

and we'll start seeing positive employment numbers next month.

It's clear we need that jobs bill ASAP.

[twiceshy]

6. Take a look at zerospin for the truth

The country is going over the cliff and putting in Health Care Reform (sic) is not going to do a damn thing to stop it.

[girl gone mad]

7. Census hiring will bring the numbers up. n/t

[ipaint]

2. Count the long term unemployed/discouraged worker and the unemployment number is up.

"This level reflected a proportional decline in the number of people unemployed and the number of people in the labor force." =

"However, Friday's report also pointed to continued structural deterioration in the U.S. labor market. Four in 10 unemployed Americans — 6.1 million of the 15.2 million jobless workers — have been without jobs for 27 weeks or more, the BLS said, adding that the number of people exiting the work force also increased in December.

"The real news in these data is the 1.9 million erosion of the labor force — those seeking work or working — since May, with a 661,000 decline last month alone,” said Lawrence Mishel, the president of the Economic Policy Institute, a liberal policy-research group. "Absent this flight from the labor market the unemployment rate would have risen substantially in December — up 0.4 percent — rather than hold steady."

http://www.mcclatchydc.com/homepage/story/81957.html

I expect ignoring the long term unemployed will be a consistent pattern for 2010. It's the only way to make the numbers barely spinnable.

[ProSense]

3. EPI: "this report is much better news than those from the first 10 months of 2009"

Labor market closes 2009 with no sign of robust jobs recovery

<...>

After very weak growth earlier in 2009, wages now appear to be growing modestly. Nominal hourly wages of production workers grew 3.9% from December 2007 to December 2008 but dropped to 2.2% growth from December 2008 to December 2009, including a 2.6% annualized growth rate over the last three months. Nominal weekly wages of production workers grew 2.4% from December 2007 to December 2008 but dropped to 1.9% growth from December 2008 to December 2009. This included a 3.8% annualized growth rate over the last three months.

Major sectors that saw growth were professional and business services (which includes temporary help services), adding 50,000 jobs, and education and health services, which added 35,000. Government lost 21,000 jobs under the pressure of budget cuts (-9,000 federal, including large layoffs of U.S. Postal Service workers, -3,000 state, and -9,000 local). Basically all other major sectors saw losses. Construction lost 53,000 in December after losing an average of 45,300 per month for the previous three months. Like the rest of 2009, most of the December construction losses were in nonresidential and heavy construction, compared to 2008, when most construction losses were in residential. Manufacturing saw a decline of 27,000 in December after losing an average of 41,300 per month for the previous three months. Wholesale trade lost 18,200 in December after losing an average of 8,100 per month for the previous three months, compared to retail trade, which lost 10,200 in December after losing an average of 31,000 per month for the previous three months.

Broadly speaking, this report is much better news than those from the first 10 months of 2009, but it nevertheless offers no signs of a robust jobs recovery. And given the 10.6 million jobs gap in the labor market, it will take enormous levels of growth for the labor market to recover any time soon. The economic case for additional government intervention to create jobs is unmistakable.

It may not be robust recovery, but it is improving.

[ipaint]

4. "but it nevertheless offers no signs of a robust jobs recovery"

The reason we need to drop the long term unemployed from the reported number. Without a "robust jobs recovery" starting yesterday there will be no recovery for the increasing numbers of unemployed gradually dropped off of the official good news number out of the administration.

We will slowly stop bleeding jobs if we are lucky but putting all these folks back to work, not going to happen. This a reset back to pre-2000 levels, not a temporary situation.

It's the logical and much predicted result of nafta and deregulation. Good jobs are permanently culled from the economy and the folks that held those jobs will be permanently culled from the numbers.

Elections are coming they must put a positive spin on a very real politically negative reality.

[Hawkowl]

5. Lying sack of shit

Romer is a fucking idiot or lying her ass off. The unemployment numbers are more manipulated than a Wall Street IPO.

[uponit7771]

8. Did the BLS lower the labor pool again? The U6 keeps goin up...

[Kurt_and_Hunter]

9. Only by 840,000