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Unemployment Stabilizes at 9.7%

March 7, 2010


Unemployment Stabilizes at 9.7%

The February employment report shows there are 3.2 million fewer jobs than February of last year. This is bad, BUT it is better than July, when there were 6.8 million fewer jobs year-over-year. To see the trend, review my calculations on Jobs Google Spreadsheet.

The unemployment rate remained at 9.7%. This would have to continue for another eight months to be as bad as the 1982 recession, when unemployment was 10% or higher for 10 months. For a history of unemployment reports since March 2007, see Unemployment Statistics History.

There were48,000 temporary jobs added in February, 15,000 of which were for the Census. In the expansionary phase of a business cycle, employers add temporary workers before hiring full-time works.

The trend in manufacturing jobs, a leading indicator, also improved. The economy now has 822,000 fewer manufacturing jobs than the year before. This is better than June 2009, when manufacturing was down 1.6 million jobs.

Manufacturing is a leading indicator because it produces the big-ticket items consumers put off buying in a recession. Once the economy starts to improve, these orders are the first to come back. In the last recession, manufacturing jobs started to improve before the overall job market. For the data, see Google Spreadsheet Manufacturing Jobs(Source: BLS, Employment Situation Summary)

What This Means for You

The increase in temporary workers reflects a shift towards the Freelance Economy.

Expect job losses to continue until July 2011, based on the experience of the 2001 recession, which lasted 8 months, and had 29 months of job losses. To find out more, see When Will Job Opportunities Improve? For a history of employment reports since March 2007, read Employment Statistics History.

Continued heavy job losses means the economy still runs a risk of a W-shaped recession, for reasons outlined here.

Articles from Alison Doyle, About.com Guide to Job Searching

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