663,000 jobs were lost in the USA in March and the unemployment rate rose from 8.1 to 8.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Since the recession began in December 2007, 5.1 million jobs have been lost, with almost two-thirds (3.3 million) of the decrease occurring in the last 5 months. In March, job losses were large and widespread across the major industry sectors.
In March, the number of unemployed persons increased by 694,000 to 13.2 million, and the unemployment rate rose to 8.5 percent. Why is that different than the numbers above? The numbers are from different sources of data, the first from BLS surveys of businesses and the 694,000 from household surveys. This reminds us that this data is approximate, not exact. Undoubtedly the figures will be revised as more data is analyzed.
Over the past 12 months, the number of unemployed persons has grown by about 5.3 million, and the unemployment rate has risen by 3.4 percentage points. Half of the increase in both the number of unemployed and the unemployment rate occurred in the last 4 months.
The unemployment rates continued to trend upward in March for adult men, 8.8%, adult women 7.0%, whites 7.9% and Hispanics 11.4%. The jobless rates for African Americans, 13.3% and teenagers 21.7% were little changed over the month. The unemployment rate for Asians was 6.4% in March, not seasonally adjusted, up from 3.6% a year earlier.
Related: Over 500,000 Jobs Disappeared in November – Manufacturing Employment Data – 1979 to 2007 – What Do Unemployment Stats Mean?
California jobless rate climbs to 10.5 percent
…
Back then, unemployment remained above 10 percent for a year and briefly hit 11 percent. This time Levy said unemployment probably will break 11 percent and stay there for months, until the housing market hits bottom and starts to recover, healing the state’s biggest economic wound.
…
Metropolitan San Francisco, consisting of San Francisco, San Mateo and Marin counties, had a jobless rate of 7.8 percent in February, better than the state or the nation.
Official unemployment rates above 10% are a huge problem. And the impacts of such high unemployment rates grow over time, so staying above that rate for long is a huge problem. And the odds favor that happening in California and such a result for the USA overall is high. It likely true that the falling housing prices will stop before the economy really starts regaining the ground it has lost recently. But the real key, in my opinion, will be when job losses stop and the economy grows jobs. If we can do that by early 2010 I think we will be lucky.
Look for an improving unemployment rate, but even more important is for the total jobs to be growing faster than 100,000 per month. Long term it needs to grow faster than that but beating that target for several months should be a strong indication we may be reaching a bottom. There are plenty of other factors to look at also: average hours worked per week, increasing average pay, GDP growth, improving consumer confidence, reduction in consumer debt…
Related: USA Unemployment Rate Rises to 8.1%, Highest Level Since 1983 – Bad News on Jobs – What Do Unemployment Stats Mean? – Over 500,000 Jobs Disappeared in November
The employment news in the USA continues to be very bad. We knew the news on job was going to be bad in 2009; still the actual news confirming those beliefs is not welcome. Of all the economic statistics for the health of the economy, employment is about the most important.
U.S. Unemployment Rate Jumps to 8.1 Percent by Debbi Wilgoren
The government revised sharply upward the number of jobs the economy lost in December and January, showing a staggering 1.99 million jobs disappearing in the past three months. More jobs were lost in each of those months than in any single month since October 1949
…
The February data showed profound losses in the professional and business services sector, with 180,000 jobs gone. Some 168,000 jobs were lost in the manufacturing industry, with most of the decline in the durable goods sector. There were 104,000 construction jobs lost as projects stalled due to the collapse of the real estate industry and the ongoing credit crisis. The financial sector shed 44,000 jobs, retail lost 40,000 jobs and the leisure and hospitality industry reported 33,000 fewer jobs. Job growth continued, however, in the health-care sector.
Analysts say the pace of job cuts is likely to remain brisk for at least a few more months
…
The number of people working part time because they cannot find full-time employment rose by 767,000 in February to 8.6 million, the government said. The unemployment rate does not reflect people who say they would like to work full-time, but can only find part-time job
Related: Over 500,000 Jobs Disappeared in November – What Do Unemployment Stats Mean? – Bad News on Jobs – Poll: 60% say Depression Likely
US living standards in jeopardy by James Jubak
…
the difference would get larger each year as the two rates were compounded. After 10 years at 2.3% growth, the U.S. economy would grow from $14.4 trillion in the third quarter of 2008 to $18.1 trillion, after accounting for inflation. At 3%, however, the U.S. economy would reach $19.4 trillion in gross domestic product.
…
The official unemployment rate hit 7.2% in December. Factor in part-time workers who would like to work full time and discouraged people who have stopped looking for work, and the real rate is more like 13.5%.
Some of those people won’t go back to work even when this recession is over because the relatively meager safety net supporting the unemployed in the United States will have given way beneath them. They will have suffered so much personal and family damage that they will never regain their full pre-recession productivity.
Related: Bad News on Jobs – The Economy is in Serious Trouble – Why Investing is Safer Overseas
Jobless Rate Rises to 6.7% in November
…
The decline, the largest one-month loss since December 1974, was fresh evidence that the economic contraction accelerated in November, promising to make the current recession, already 12 months old, the longest since the Great Depression. The previous record was 16 months, in the severe recessions of the mid-1970s and early 1980s.
…
The manufacturing sector has been particularly hard hit, losing more than half a million jobs this year. That is nearly half the 1.2 million jobs lost since employment peaked in December and, in January, began its uninterrupted decline. The cutbacks seem likely to accelerate as the three Detroit automakers close more factories and shrink payrolls even more
…
With all this in mind, and particularly the shrinking employment rolls, economists are estimating that the gross domestic product is contracting at an annual rate of 4 percent or more in the fourth quarter, after a decline of 0.3 percent in the third quarter.
The news was even worse than the anticipated 350,000 losses. And Previous months figures were adjusted from 240,000 losses in October to 320,00 and from 284,000 in September to 403,000. And these numbers are on an already extremely poor job picture the previous 7 years. One of the great strengths of the US economy over the last 50 years has been job creation. We know we are in for serious problems, the question is how serious and how long. One of the most important gages of that will be how many jobs are lost.
When job losses stop and job gains start (in the aggregate, for the entire economy) it will be a very positive sign. Normally jobs are a lagging indicator, meaning job data lags the actual economy. Job losses will not increases until after the economy starts to grow. Of course, economic data doesn’t always fit the conventional wisdom.
This is one more piece of evidence that the economy is not looking good. And 2009 is likely to be a bad year for the economy overall.
Related: Bad News on Jobs (Sep 2008) – What Do Unemployment Stats Mean? – The Economy is in Serious Trouble – Financial Market Meltdown
I have had difficulty finding good economic data on manufacturing jobs. I have posted about this previously but have trouble finding much worth posting about: Worldwide Manufacturing Job Data – Manufacturing Jobs. The Unites States Department of Labor, Bureau of Labor Statistics has published some interesting data and so here is a look at some of that data.
The table shows average annual productivity gains (output per hour, in USA dollars – I think it is not clear) – the 2007 output totals are from the United Nations data I posted about last week (Data on Top Manufacturing Countries).
| Average Annual Manufacturing Productivity Gains by Country | ||||||
|---|---|---|---|---|---|---|
| Country | 1979-1990 | 1990-1995 | 1995-2000 | 2000-2007 | 1979-2007 | 2007 Output $USA billion |
| Taiwan | 6.1 | 4.7 | 5.6 | 6.4 | 5.9 | |
| Korea | NA | 9.4 | 10.8 | 7.6 | NA | 241 |
| USA | 2.8 | 3.7 | 5.6 | 4.6 | 3.9 | 1,831 |
| France | 3.8 | 3.4 | 4.6 | 3.5 | 3.8 | 296 |
| Japan | 3.8 | 3.3 | 3.4 | 3.8 | 3.6 | 926 |
| United Kingdom | 4.1 | 2.8 | 2.7 | 3.9 | 3.6 | 342 |
| Germany | 2.1 | 2.9 | 3.7 | 3.8 | 3.0 | 670 |
| Spain | 3.3 | 3.1 | 0.8 | 2.1 | 2.5 | 208 |
| Canada | 2.1 | 3.4 | 3.8 | 1.1 | 2.4 | 218 |
| Italy | 3.4 | 3.8 | 1.4 | -.2 | 2.2 | 345 |
The countries that were part of the study but are not included in the table above: Australia, Belgium, Denmark, Netherlands, Norway, Sweden.
Manufacturing productivity increased in 14 of 16 countries in 2007, according to the study. The United States of America increase of 4.1 was the fourth largest among the 16 economies and was slightly above the 3.9 percent U.S. average annual increase since 1979. 15 of the 16 countries increased manufacturing output in 2007.
9 countries increased manufacturing hours worked in 2007, the USA increased 2.3% (below their average increase since 1979). Hours worked decreased for all countries in the period of 2000-2007 (UK has had the largest decrease 3.9% annual average decrease, the USA in next at 3.1%).
Manufacturing employment increased in 10 countries in 2007. From 2000-2007 the USA has experienced average annual declines of 3% in manufacturing employment (the second sharpest drop to the UK which has fallen 4%). From 1979-2007 the USA annual declines averaged 1.2% (only Taiwan.9% and Spain .1% showed increases). From 2000-2007 four countries show slight average annual increases: Spain .5%, Korea .4%, Taiwan .2% and Italy .2%. From 2000-2007 only 3 countries showed annual average decreases in output: Canada -.3%, Italy -.2% and UK – .1%.
Hourly manufacturing compensation has increased in all countries for the period 1979-2007 (data shown for this item is in each national currency: USA 4.6% average annual increases, Spain up 7.2% annually, Taiwan up 7%, UK 6.8%, Germany 4.4%, Japan 4.2%.
via: Canada’s Manufacturing Crisis in International Perspective
Related: posts on employment – Top 10 Manufacturing Countries 2006
The growth in the number of jobs in the USA continues to be bad. The growth in jobs has been very poor thus far this century. The good news has been unemployment has been fairly low, it now sits at a 4 year high of 5.7% (which is not great but not horrible by historic standards).
Update: today the labor department announced the unemployment rate increased to 6.1%.
This year the news has been worse, with actually declining numbers of jobs and some economics see No job turnaround on horizon:
…
“I’m not expecting increases in employment until next year because in the second half of this year we’ll see very lethargic economic growth,” said Joel Prakken, chairman of Macroeconomic Advisers. The Conference Board has created a new reading called the Employment Trends Index, which combines a number of different economic readings to predict when employment will turn higher or lower. The index, which typically signals three to six months before job losses will turn to job gains, has yet to show signs of a recovery.
“We think the unemployment rate will keep growing, probably reach between 6 to 6.5% by mid 2009 and only start declining in the second half of next year,” said Gad Levanon, senior economist at The Conference Board.
Related: What Do Unemployment Stats Mean? – Economic Fault: Income Inequality
Americans working past retirement
…
Twenty-nine percent of people in their late 60s were working in 2006, up from 18 percent in 1985, according to the Bureau of Labor Statistics. Nearly 6 million workers last year were 65 or over. Over the next decade, the number of 55-and-up workers is expected to rise at more than five times the rate of the overall work force, the BLS reported.
…
Working another three years — from 62 to 65, for example — and continuing to save 15 percent of salary could raise annual income from investments by 22 percent. Make it five years and boost savings contributions still higher — even better.
Putting off retirement also may enable people to delay when they start taking Social Security benefits, which can significantly increase payments.
“The longer the delay, the better” financially, said Fahlund. “To me the ideal would be 70, because you get the biggest Social Security benefit possible and all those additional years of employment. And it keeps you going mentally and physically too.”
The economic reality is retiring at 62 is not realistic for most people today. Retirement age has barely budged at life expectancy has increased by 20 years. I have long felt the best practice for the economy is to provide part time work to transition into retirement. This allows people to slow down their work lives, but not completely leave it behind. And the financial benefits are very helpful to all those that did not save enough early in their lives.
Related: Retirement Delayed, Working Longer – Our Only Hope: Retiring Later – Many Retirees Face Prospect of Outliving Savings – Retirement Savings Survey Results – Saving for Retirement – Spending Guidelines in Retirement – Tips To Allow Retiring Sooner
Students Grow Desperate Over China’s Tight Job Market
But indications have emerged that, booming as it is, the economy may not be able to absorb that many degree-holders into the jobs for which they are being trained. “The fact is that it’s very hard for college students to get the right job these days,” said Zhang Xuxin, a Zhengzhou student with close-cropped hair and plastic-rimmed glasses who plans to pursue postgraduate studies next year. “You may have a job, but it’s very hard to have an ideal one.”
Growing an economy to create huge numbers of even decent jobs is very difficult, especially when starting from where China and India were in 1990. Often the strength of China’s economy blinds people to the continued great difficulty. Good jobs are the lifeblood of an economy. China has lost far more manufacturing jobs than any other country. Yes, even as they have grown their manufacturing production enormously. The entire world is increasing manufacturing output while decreasing manufacturing employment, see: Manufacturing Jobs Data: USA and China.
Graduates shut out of job market
Read more