Isn't it ironic that ahead of an employment report where the range of forecasts was wider than any other time in recent memory, the actual number of jobs lost was closer to the consensus forecast than any other time in recent memory? Today's non-farm payrolls report showed that the US economy lost 524,000 jobs in December versus forecasts for a decline of 525,000 jobs. Today's difference was only one thousand jobs. While usually the difference between the actual and consensus forecast is measured in the tens of thousands, today's difference was only 1,000.
The charts below highlight some of the key employment measures in today's report, and how the current levels compare to historical levels. The first chart shows the year/year change in non-farm payrolls. As shown, we are currently at levels not seen since the 1982 recession. With the large drop in payrolls, the unemployment rate rose to 7.2%, which is the highest level since shortly after the 1990 contraction.
The average work week also showed a noticable drop with a decline of 0.2 hours (from 33.5 down to 33.3). Before reading too much into this, however, it's important to remember that this indicator has been in a steady decline since the 1960s. This morning on CNBC, one commentator suggested that the new low in this reading was an ominous signal for the economy. However, this indicator has been hitting new lows for the last fifty years! We know it's bad out there, but the US economy has not been on the decline for the last half century. Finally, for people that are working, the year/year change in average hourly earnings ticked higher in December. So while employees are working less, at least they're earning more for the time they put in.
The above charts are part of the "Economic Indicator" section of The Bespoke Report: 2009, which will be emailed out to subscribers this evening. To receive your copy, subscribe to Bespoke Premium today.
Wow, look at that avg work week trend and now the recent cliff dive
We may be a country of part time workers.
What we have though is part time CEO's and Gov't workers getting paid way more than they deserve.
Posted by: Max | January 09, 2009 at 01:13 PM