Jobs created, unemployment falls

This is for all my really good friends - you know who you are - who tried to disparage the enormous economic growth we had last quarter by saying that this growth didn't really matter because no jobs were created. You were 100% wrong - from today's NY Times:

_________________________________________________________________

Employment Rose Sharply in October as Jobless Rate Fell

By DAVID LEONHARDT

Published: November 7, 2003

The longest hiring slump in more than 60 years finally appears to have ended.

Employment grew by 126,000 jobs in October, the best showing in nine months, the Labor Department reported today, and job growth in August and September was significantly stronger than the government had initially estimated. It was the first time since late 2000 that the economy added workers for three straight months.

The unemployment rate fell slightly in October, to 6 percent, from 6.1 percent the month before.

"This is as dramatic a turnaround as you could hope for," said Ian C. Shepherdson, the chief domestic economist at High Frequency Economics in Valhalla, N.Y.

Restaurants, real-estate companies, doctor's offices and most of the rest of the broad service sector added to their payrolls last month, apparently in response to the recent jump in household spending, economists said.

Manufacturers, still struggling against foreign competition, cut jobs for the 39th consecutive month, but the loss was the smallest since the early months of the streak.

The number of people working part-time because they could not find full-time work fell 139,000, to 4.8 million. Average hourly wages rose by just a single cent, but an increase in hours as businesses worked harder to keep up with rising demand fattened weekly paychecks.

The recent job gains remain modest by many measures. They are not large enough to keep up with the growth of the labor force, suggesting that last month's decline in the jobless rate might have been a statistical blip.

"This is at most the beginning of the end, not the end itself," Drew Matus, an economist at Lehman Brothers, wrote in a note to clients this morning. The labor market recovery "is still in its early stages and still somewhat fragile."

But the increases also represent clear progress after two and a half years of layoffs and weak hiring that sliced the nation's payrolls by more than 2.5 million jobs, the biggest decline since the early 1980's.

The report offered more good economic news for President Bush, who has credited the three tax cuts passed since 2001 with softening the economic slump and predicted that they would eventually lead to job growth.

"We're delighted," said N. Gregory Mankiw, the chairman of the White House's Council of Economic Advisers. "I think we'll see robust job growth going forward."

The employment gain complicates the task of the Democratic presidential candidates, who have the made the severe job losses a centerpiece of their campaigns. Representative Pete Stark of California, the ranking Democrat on Congress's Joint Economic Committee, noted that the current pace of job growth would need to continue for 19 months to return to the peak employment level reached in early 2001.

If the job gains continue, they will also increase the odds that the Federal Reserve will raise its benchmark short-term interest rate during the first half of next year. Since June, the Fed has kept the federal funds rate on overnight loans at its lowest level since 1958 in an effort to shock the economy out of its sluggishness.

Low interest rates have led to a surge in mortgage refinancing, giving many families more cash to spend, and also decreased the cost of many car loans, small business loans and other types of loans.

Stocks rose modestly after the release of today's employment report. By mid-morning, the Standard & Poor 500-stock index was up about two-tenths of 1 percent. Bond prices, meanwhile, were lower. The Treasury's benchmark 10-year note was down about half a point, while its yield rose to 4.47 percent, from 4.41 percent late Thursday.

>This is for all my really good friends - you know who you are

>- who tried to disparage the enormous economic growth we had

>last quarter by saying that this growth didn't really matter

>because no jobs were created. You were 100% wrong - from

>today's NY Times:

And this is for all you idiots -- you know who you are -- who don't understand the meaning of the word "quarter." A calendar quarter is composed of three months. That's because one quarter of 12 months is 3 months, remember? The most recent quarter for which GDP growth figures are available is the third quarter of 2003, which ended in September of 2003. That quarter does not include October of 2003. So jobs created in October of 2003 were NOT created in that quarter. Got it, dummy?

And this is for all you dolts who come to this board to pontificate about the economy but who are too stupid to understand that the jobs figures the papers keep referring to are NET jobs created, meaning the excess of jobs created in a given period over jobs lost. In fact, the economy creates some jobs every month -- the issue is whether there are enough new jobs to match or better the number of people who enter the labor force during that month PLUS the number of jobs lost during that month. If not, there is a NET LOSS of jobs. Since Bush became president there has been a NET LOSS of more than 2 million jobs.

There are enough people entering the U.S. labor force each month that the economy needs to create scores of thousands of new jobs in that month just to keep the unemployment rate from rising. If there are layoffs during that month, the economy has to create enough jobs to stay even and enough to balance the layoffs, and if there are more jobs created than that, THEN there is a NET increase in jobs. Got it, pinhead?

I think his point was not that these jobs were part of the quarter just finished but that in additional to a gain in the economic indicators for the quarter finished, we now have additional jobs created. Many mentioned that during the quarter finished the jobless rate didn't improve even though the indicators did. Now the jobless rate is improving. OK,pinhead!!

>I think his point was not that these jobs were part of the

>quarter just finished but that in additional to a gain in the

>economic indicators for the quarter finished, we now have

>additional jobs created. Many mentioned that during the

>quarter finished the jobless rate didn't improve even though

>the indicators did. Now the jobless rate is improving.

>OK,pinhead!!

Thank you for saving me the trouble of teaching that to him. It's nice how you spoke slowly for him, too; I find that increases the chances that he digests it.

It's simultaneously hilarious and sad to watch people atcully ROOT FOR economic collapse so that they can achieve political success. No matter how much economic data you show them, no matter how much growth there is, they will find reasons to claim that we're still on the brink of a depression - at least until Paul Krugman finally tells them that they can't say that any longer with a straight face.

Here's one economists' view of these numbers:

________________________________________________

Payroll numbers grow again

November 7, 2003: 5:00 PM EST

By Mark Gongloff, CNN/Money Staff Writer

NEW YORK (CNN/Money) - U.S. payrolls grew in October for the third straight month, the government said Friday, trouncing Wall Street expectations as the labor market accelerated its recovery from its longest slump since World War II.

* * * *

"Today's employment report is just one month's report, but it's the one we've been waiting for, providing unambiguous good news about the labor market," said Bill Cheney, chief economist at John Hancock Financial Services in Boston.

_________________________________________

"Unambiguous good news about the labor market," that is, to everyone who is sane and rational.

The Jobless Recovery

Since we are quoting, here is an extract from Money magazine:

Other economists note, however, that job growth is still not strong enough to keep up with the 150,000 or so new entrants to the labor force every month, and few economists expect a significant decline in the unemployment rate in the next year.

"We're not talking about adding 300,000 jobs, which is what you get when things are really going well; we're still a long way from that," said Robert MacIntosh, Fed watcher and chief economist at Eaton Vance Management. "I don't think it's an issue at all from an inflationary standpoint."

Payrolls are still 2.4 million jobs smaller than in March 2001, when the 2001 recession began. Though job growth has come in spurts since then, payrolls are still about 800,000 jobs lower than in November 2001, when the recession officially ended.

Here is an extract with joint reporting from Newsweek and MSNBC:

UNFORTUNATELY, THERE IS still no evidence that a surge of growth in the U.S. economy is creating jobs. Even the U.S. economy’s surprisingly strong third-quarter showing last week does not change the fact that many of the factors creating the jobless recovery in the United States are still in place. The dot-com boom led companies to hire floods of people and invest in all kinds of digital technology that they still have not begun to fully use. As markets have crept upward, businesses have tapped into these earlier investments to be productive without having to add employees. Equipment is still being used at three quarters of capacity, well below the average 84 percent, and quarterly productivity numbers are still rising. But the most powerful forces behind the U.S. jobless recovery are global phenomena that will likely hamper the rest of the developed world’s fight against unemployment when their economies eventually return to health. China is becoming a factory to the world, allow-ing American, European and Japanese firms to farm out production at much lower costs. And the Internet now makes it possible to outsource even high-tech services to such low-wage countries as India and the Philippines. The result of this global labor arbitrage, argues Stephen Roach, chief economist with Morgan Stanley, is “the distinct possibility that jobless recoveries may remain the norm in high-cost developed economies for some time to come.”

        Not that the news for the American work force—and, by extension, for the world’s—is all gloom and doom. Corporate profits are clearly on the rise, and IT spending is expected to jump next year. The Chicago outplacement firm Challenger, Gray & Christmas, which tracks layoff announcements, says monthly averages have fallen from 130,000 to 70,000 in the past five months. Nevertheless, there are no sure bets when it comes to employment numbers. Layoff announcements usually surge in the final quarter, and Challenger expects that the recent round of multibillion-dollar mergers just announced will squeeze out thousands more workers just as the holiday retail season begins. “It’s not time to start dancing in the streets,” says Rick Cobb, executive vice president at Challenger. “It’s going to be a slog.”

        And before long, Europe and Asia will feel the same global pressures. While Morgan Stanley chief European economist Eric Chaney expects unemployment to initially slide from 8.8 percent to about 5 percent over the next few years, “outsourcing will cap employment growth in the medium to long term,” he predicts. TPI, a major consulting firm that tracks outsourcing deals, has found that new large offshore contracts have grown by 83 percent so far this year, a faster rate than in the United States. Germans are increasingly turning to Eastern Europe. French companies are setting up call centers in cheaper Francophone countries like Morocco. In Japan, there are hints that the long recession is about to bottom out, but companies will be more focused on rebuilding their own profits than in bulking up payrolls, says Kathy Matsui, a managing director for Goldman Sachs. With the exception of the auto and consumer-electronics industries, businesses are woefully behind in taking advantage of low-cost labor in their own backyards. “The trend is clear for the G7” countries, she says. “Japan will be doing more outsourcing.”

In short, there are far less jobs today than there were in 2001; there are far less job created in the past twentyfour months which are suitable for a head of household (single or otherwise); and there are more people working multiple jobs now than in 1999. If the current three months (August, September and October 2003) of modest job creation actually continued for a prolonged length of time (at least nine months and preferably twelve months) and ultimately led to employment for the 2.5 million people currently seeking good long term employment and also could have some impact on the 2.25 million plus individuals who no longer are looking for work, then perhaps anyone might be able to point to some benefits.

At this time, it is highly premature and disingenious.

>>I think his point was not that these jobs were part of the

>>quarter just finished but that in additional to a gain in

>the

>>economic indicators for the quarter finished, we now have

>>additional jobs created. Many mentioned that during the

>>quarter finished the jobless rate didn't improve even though

>>the indicators did. Now the jobless rate is improving.

>>OK,pinhead!!

Well, no, that wasn't his point, as it is stated absolutely nowhere in his post. As one of his fellow Reaganites, you are just trying to save him from the embarrassment of showing what a crackpot he is. But it didn't work. You're too stupid to pull off something as difficult as that.

>Thank you for saving me the trouble of teaching that to him.

>It's nice how you spoke slowly for him, too; I find that

>increases the chances that he digests it.

I'm afraid it's too late to cover up the fact that you don't understand the very figures you are quoting. It's apparent to everyone by now.

>It's simultaneously hilarious and sad to watch people atcully

>ROOT FOR economic collapse so that they can achieve political

>success.

More of your filthy, right wing lies. Anyone who opposes your foreign policy is giving in to Osama (or is it Saddam this week?). Anyone who criticizes your economic policy is rooting for economic failure -- rather than, as is truly the case, rooting for a change in economic policy. Can you really fail to see that this stale, tired tactic convinces no one?

>Well, no, that wasn't his point, as it is stated absolutely

>nowhere in his post. As one of his fellow Reaganites, you are

>just trying to save him from the embarrassment of showing what

>a crackpot he is. But it didn't work. You're too stupid to

>pull off something as difficult as that.

First, the economy wasn't growing. So Bush-haters said: "Bush's economic policies are failing because the economy isn't growing.

Then the economy grew - by leaps and bounds.

Then Bush-haters said: "Yeah, the economy might be growing, but no jobs are being created, so Bush's economic policies are still failing."

Now jobs are being created.

So now, Bush-haters have nothing else left to say - so the more desperate ones say: "Yeah, jobs are being created, but not in the LAST QUARTER, only in THIS QUARTER" - as though that fucking matters!!!

There is vibrant economic growth. Jobs are being created. Objective, non-partisan economists say that this is UNAMBIGUOUS great news for the economy.

But you sit back like a bitter grandmother without teeth, complaining about the economy (and everything else you can think of) even in the face of universal, unamiguous good economic news.

But hey - who needs facts when you have a bitter ideological agenda to advance?

>More of your filthy, right wing lies. Anyone who opposes your

>foreign policy is giving in to Osama (or is it Saddam this

>week?). Anyone who criticizes your economic policy is rooting

>for economic failure -- rather than, as is truly the case,

>rooting for a change in economic policy. Can you really fail

>to see that this stale, tired tactic convinces no one?

The reason it's clear that you are rooting for economic collapse isn't because you disagree with Bush's economic policies. Lots of rational people disagree with those economic policies but still acknowledge the reality that the economy is recovering.

The reason it's clear that you are rooting for economic collapse is because even in the face of unambiguous evidence to the contrary, you squint your eyes and insist that the economy is failing. Someone who hopes for something so strongly will believe it's happening no matter what. That's you.

But I'm not worried - once Paul Krugman, your money-rabbi-god-guru, is finally forced to admit that the economy is growing, you'll follow suit like the little obedient lap dog that you are.

>>Well, no, that wasn't his point, as it is stated absolutely

>>nowhere in his post. As one of his fellow Reaganites, you

>are

>>just trying to save him from the embarrassment of showing

>what

>>a crackpot he is. But it didn't work. You're too stupid to

>>pull off something as difficult as that.

>First, the economy wasn't growing. So Bush-haters said:

Blah, blah, blah, blah. A bunch of verbiage having nothing to do with my post in this (or any other) thread, all designed to conceal the fact that you posted a rant about the economy that shows your complete lack of knowledge on the subject.

>Then the economy grew - by leaps and bounds.

I almost hesitate to mention this, but has anyone ever explained to you that the "leaps and bounds" growth rate of the last quarter only looks big on an ANNUALIZED basis? Do you know what that means? It's sort of like saying that if you loan me $1,000.00, I'll pay you 2% interest per month. On an annualized basis, that's 24% interest. But of course if I stop paying after the first month, you only get 2%. See the difference, stupid?

>Now jobs are being created.

<Sigh> As I explained above, jobs are created EVERY month. The issue is whether ENOUGH jobs are created to take care of all the new entrants into the labor force, which is about 150,000 per month, PLUS some of the people who are looking for work. Now do you get it?

>So now, Bush-haters have nothing else left to say - so the

>more desperate ones say: "Yeah, jobs are being created, but

>not in the LAST QUARTER, only in THIS QUARTER" - as though

>that fucking matters!!!

My gosh, you really ARE an imbecile, aren't you. Do you suppose which quarter jobs are created in might matter to people who are LOOKING FOR A JOB IN A CERTAIN QUARTER, you callous son of a bitch?

>But you sit back like a bitter grandmother without teeth,

>complaining about the economy (and everything else you can

>think of) even in the face of universal, unamiguous good

>economic news.

Why don't you tell it to the more than 2 million people who have lost jobs since your hero Bush got into office? You can have a chat with them after you get through explaining to the people who come to family day at your local rehab clinic that taking drugs harms no one but the people who take them.

Quick, get our your calculator and tell us how many new jobs will have to be created each month until the next election so that Bush will NOT be the first president since Hoover to preside over an economy with a NET LOSS of jobs?

>But I'm not worried - once Paul Krugman, your

>money-rabbi-god-guru, is finally forced to admit that the

>economy is growing, you'll follow suit like the little

>obedient lap dog that you are.

So tell me, how does Bush's ass smell today? You obviously get close enough to be able to give us an informed opinion.

RE: The Jobless Recovery

Let us see if this will recovery will be sustained.

"W" may just be a one-quarter-wonder.

More cold water on the so-called recovery, from today's CNN/Money page. Our right wing nuts can dismiss the Marxist media, but nonetheless:

...in many ways, the labor market is worse than the unemployment rate would indicate. One negative figure from the Labor Department's mostly positive report on October unemployment was the abysmal 66.1 percent labor-force participation rate, the lowest level since April 1993.

What that means is that, even as some people re-entered the labor force to start looking for a job, an even greater number retreated to the sofa to wait for things to get better. When those people start pounding the pavement again, the official unemployment rate could rise.

What's more, in September and October, more than 23 percent of the nation's 8.8 million unemployed had been out of work for 27 weeks or more. There haven't been two straight months at such a high level since late 1983.

Meanwhile, the average workweek, according to the Labor Department, is just 33.8 hours long -- the same as it was in October 2002 and in September 2001. Many economists think businesses will start lengthening the workweek before they start hiring workers in big numbers.

Most importantly, however, wage growth has continued to decelerate. Growing wages are critical to the future of consumer spending, which makes up more than two-thirds of the total economy.

In October, average hourly earnings grew just 0.1 percent, according to the Labor Department. In the past three months, the annualized growth rate has slowed to just 0.8 percent, the slowest pace ever.

"If full employment is 6 percent, we wouldn't have seen wages decelerate," said Jim O'Sullivan, senior economist at UBS Warburg. "If anything, we would be seeing an acceleration."