Employment Edges Up
Analysts were also pleased that the BLS revised August figures to show a 89,000 job increase. The BLS stated the dramatic change in its estimate was a result of data based on incomplete data, as not all of the 160,000 businesses surveyed by the BLS are able to get their reports in by the first Friday of the month.
The increase in September was due, primarily, to teenagers going back to work as the school year started. The good news is that, year-over-year this represents a 1.2% increase over last September, which also showed an increase due to teenager workers returning to school. The bad news is that this is the weakest job growth since 2004.
The unemployment rate edged up to 4.7%. This increase is not really a concern, since it is in the same range it has been in since September 2006.
Manufacturing jobs continued the downward spiral begun last October. In September, there were 1.6% fewer manufacturing jobs than the year before. Manufacturing jobs are a good leading indicator of overall economic performance, since they produce big-ticket items that consumers will put off buying when the economy starts to weaken. As the orders decline, manufacturers will hire less workers, and even lay off existing workers to keep costs low. (Source: BLS, Employment Situation Summary)
What This Means for You
The employment base in the U.S. is shifting ever more rapidly away from a goods-producing to a service economy. Many experts argue that this is causing the U.S. economy to lose its competitive edge over the long term. However, since the employment report is better than had been expected, it could mean that the impact of the Subprime Mortgage Crisis could be less than feared. The next employment report will be critical in determining the trend, so check back November 2. For a summary of recent trends, check out Employment Current Statistics.Related Articles
- A Primer on the Role of Supply in the U.S. Economy
- The Impact of an Aging Labor Force on the U.S. Economy
- How the U.S. Is Losing Its Competitive Edge
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Comments
Kim, there’s a lot of concern out there regarding the ‘politicizing’ of government data…like last month’s ‘oopsie!’ which resulted in the Fed cutting the inter-bank & discount window rates by 50 basis points…a bit ‘convenient’, no?
Which is to say it’s situations like this that cast grave doubts regarding who the consumer/investor can trust.
Which brings us to the second item, the ’strength’ of the economy.
While the ‘official’ unemployment figures are ‘low’, over the past seven years the number of folks counted as ‘not in the labor force’ has risen by 9 million…
Add to that the ‘average’ workweek is now hovering in the 33hr range, which would indicate part time work is more prevalent than full time employment.
The we arrive at the notion that the ’strength’ of our economy is reflected in the ‘value’ of our currency…which is dropping like a rock.
Um that which we no longer produce for ourselves has to be brought in from elsewhere, something most of us would count as an economic ‘weakness’ which is being ‘reflected’ in the value of our currency.
Batten down the hatches, there’s rough seas ahead!
If not rough seas, at least then end of a very long, very expensive party. Why we had to go into $8 trillion in debt when the GDP per capita is $43,800, compared to $7,800 for China I’ll never understand. I just look at people driving gas-gazzling SUV’s and think…enjoy it while it lasts, boys, enjoy it while it lasts.
Although I still think it will go out “not with a bang, but a whimper.”