September 7, 2012
THAT’S CONVENIENT: U.S. August payrolls rise 96,000, jobless rate falls to 8.1%. Still makes 43 months above 8 percent, though . . . .
UPDATE: Workforce hits 30-year low. “That’s a new 30-year low in the civilian participation rate, lower than April’s 63.6%. That’s the reason for the decline in the jobless rate. The workforce decline artificially depresses the official unemployment rate. If we had the same level of civilian participation as we did at the beginning of the recovery in June 2009 (65.7%), we’d be looking at a jobless rate of well over 10%. The employment-population ratio dropped to 58.3% in August, not as low as last year’s 58.2%, but still bouncing along a generational bottom. That measure was 59.4% at the beginning of the recovery.”
Larry Herring on Twitter: “If Obama can get everyone out the the workforce, the unemployment rate will be 0%!!”
Also: Unemployment rises in every major market since recession. Are we really even in a “recovery?”
UPDATE: From a reader:
I am betting you heard from other finance guys already, but these numbers were bad, bad, bad. We were hoping for at least 130k, and you really need 150k just to stay even. What’s happening here is that people are leaving the jobs market. Once a worker goes off his 99 weeks of unemployment payments (I refuse to call anything beyond the 27 weeks they paid for “insurance”), he heads straight to Social Security disability. JP Morgan noted this several months ago, and the trend seems to be accelerating.
Once you’re on SSDI, you’re off the unemployment rolls. Last month, 368,000 people stopped looking for work. I am certain that we will continue to pay for those people, only they now help the unemployment number by ceasing to exist.
Top two claims are for back pain and stress. Both are difficult to disprove.
Indeed. Also, from Points and Figures:
The unemployment numbers were released this morning. They were not as good as expected. Pretty horrible actually. Some of the comments from pundits ahead of the number were interesting. Diane Swonk said, “I never thought I’d be reading political briefs to make my decisions on investing.”. She and I both. It’s a weird time.
Our labor participation rate is horrific. It almost looks to me like government employees are messing with that number in order to change the headline percentage number. Older statistics were revised down. It’s not as if we haven’t seen manipulation in other areas of the bureaucracy. We are stymied with current policy on unemployment.
This number won’t have an effect on voting booths in November. Americans know the economy is shit. What is anyone going to do about it?
The way out of our situation is growth. In order for America to resume a typical growth path, we need to create around 300K jobs per month or more. That level of job creation will drop the unemployment rate at a good clip over time.
John Galt was unavailable for comment.