photo credit: davitydave
Unemployment reaches 26-year high. Bloomberg reported today that the pace of job losses has “slowed” but we reached a nearly three decade low last month.
Now I am not one to predict doom and gloom when it isnt called for, but for those who believe that the worst days of the economic recession are behind us should probably take counsel from the now more than 6.9 million Americans who have lost their jobs since 2007. While numbers turned up slightly in July, they took a recently more familiar turn last month leading us to the lowest watermark since the ealry 80′s.
On another front, some of the specific numbers involved in the overall unemployment picture are rather interesting. As Joe Biden is running around town singing the praises of the economic stimulus, it appears that the government was one of the biggest culprits in adding to the ranks of the unemployed. (Reuters) Government employment fell 18,000 last month which was actually an improvement from July where it dropped 28,000.
Now I would usually applaud the downsizing of government in such a manner but on a deeply personal level it seems quite odd that the administration that is talking in terms of successes rather than failures regarding economic stimulus would overlook the fact that the government itself has taken away 44,000 jobs in two months. Bloomberg outlined just how bad the overall picture may be…
Recession’s Toll
The latest numbers brought total jobs lost since the recession began in December 2007 to 6.9 million, the biggest decline in any post-World War II economic slump.
Among the 14.9 million unemployed Americans in August, 4.99 million were out of work for more than 26 weeks. The percentage of jobless who weren’t classified as on temporary layoff rose to 53.9 percent, up from 39.1 percent a year ago.
“Layoffs that we’re having are more structural and not cyclical, and that makes it more difficult to have a meaningful rebound in income growth, which is a key ingredient as I said for sustainable self re-enforcing expansion,” said Tony Crescenzi, a market strategist and portfolio manager at Pacific Investment Management Co., manager of the world’s biggest bond fund.
Breadth of Declines
All major job categories recorded losses in August, with construction payrolls tumbling 65,000, factories cutting another 63,000 and retailers firing 10,000 people.
Whirlpool, the world’s largest appliance maker, is among those firms still eliminating positions. The Benton Harbor, Michigan-based company said Aug. 28 it will close its Evansville, Indiana, manufacturing plant, resulting in the elimination of 1,100 jobs.
Fort Worth, Texas-based American Airlines, a unit of AMR, said this week it will furlough 228 flight attendants and put 244 more on involuntary leave.
Federal Reserve officials had “particular” concern about the job market when they met Aug. 11-12, minutes of the gathering showed this week.
“Long-term unemployment and permanent separations continued to rise, suggesting possible problems of skill loss and a need for labor reallocation that could slow recovery in employment begins to expand,” the Fed said in the minutes released Sept. 2.
At the end of the day, jobs are not the only measure of whether an economy is on the upturn or not, but they are certainly representative of whehter it is time to pat ourselves on the back for all the American money spent on federal stimulus. If $6 trillion in stimulus = (-) 40,000 jobs I for one dont like the math.
