Diary

The Road to 4 million (May jobs report)

Jobs gained / (lost) in May 2010 per the US Dept of Labor  (prelim):           431,000

Jobs gained / (lost) in April 2010 per the US Dept of Labor  (prelim):           290,000

Jobs gained / (lost) in March 2010 per the US Dept of Labor  (final):           208,000

Jobs gained / (lost) in February 2010 per the US Dept of Labor  (final):       39,000

Jobs gained / (lost) in January 2010 per the US Dept of Labor  (final):         14,000

Jobs gained / (lost) in December 2009 per the US Dept of Labor  (final):    (109,000)   

Jobs gained / (lost) in November 2009 per the US Dept of Labor  (final):       64,000   

Jobs gained / (lost) in October 2009 per the US Dept of Labor  (final):         (224,000)

Jobs gained / (lost) in September 2009 per the US Dept of Labor  (final) :   (225,000)

Jobs gained / (lost) in August 2009 per the US Dept of Labor  (final) :        (212,000)

Jobs gained / (lost) in July 2009 per the US Dept of Labor  (final) :             (346,000)

Jobs gained / (lost) in June 2009 per the US Dept of Labor  (final) :            (515,000)

Jobs gained / (lost) in May 2009 per the US Dept of Labor  (final) :             (387,000)

Jobs gained / (lost) in April 2009 per the US Dept of Labor  (final):              (528,000)

Jobs gained / (lost) in March 2009 per the US Dept of Labor (final):            (753,000)

Jobs gained / (lost) in February 2009 per the US Dept of Labor (final) :       (726,000)

 

Total jobs gained / (lost) since Obama took office :                                (2,979,000)   

 

Number of jobs promised by the Obama administration :                           4,000,000

Number of jobs remaining to hit goal :                                                       6,979,000

Link to Bureau of Labor Statistics data (raw figures of jobs gained / (lost)).

Job gains came in at 431,000 in May. April figures were unchanged, and March numbers were revised lower from 230,000 to 208,000 jobs gained for the month.

While on the surface the May job growth was the best result since March 2000, it was almost all the result of further temporary hires by the US Census Bureau for the 2010 census (411,000).  Those jobs will start going away next month as the census activity begins to wind down.  Wall Street was immediately spooked Friday by the lack of private-sector growth with the Dow having its third worst day of the year, falling 324 points to end below 10,000 at 9,931.

Unemployment rate as of : May 2010, 9.7%

April 2010, 9.9%

March 2010, 9.7%

February 2010, 9.7%

January 2010, 9.7%

December 2009,  10.0%

November 2009, 10.0%

October 2009, 10.1%

September 2009, 9.8%

August 2009 : 9.7%

July 2009: 9.4%

June 2009: 9.5%

May 2009: 9.4%

April 2009  8.9%

March 2009 : 8.6%

February 2009 : 8.2%

 

Link to Bureau of Labor Statistics data (unemployment rate trends)

 

Unemployment rate decreased to 9.7% in May, the same rate it held for the first three months of the year before ticking up to 9.9% last year.  The “underemployment” rate (a measure including those that have quit looking for work, as well as those settling for part-time work when they can’t find a full-time job) fell to 16.6%, versus April’s 17.1%.

 

Dip in unemployment rate seems to be for the opposite reasons of last month’s small increase.  In April, the increase in the unemployment rate was largely attributed to discouraged workers getting off the sidelines and re-entering the job seeking arena, and thus being included in the unemployment rate calculations.  In May, unfortunately, the decline is not because of sufficient hiring, but workers largely leaving the labor force.

 

 It’s important to note that the jobs losses and the unemployment rate are determined through separate surveys.  Job losses come from Establishment Survey Data, and the unemployment rate comes from Household Survey Data.  While the two measures should be directionally consistent, differences in the methodology can occasionally lead to what might appear to be disparate results.  April was a prime example of such a case as the economy added 290,000 jobs, but yet the unemployment rate went up by 0.2%.

 

Reaction from economists was mixed.  Some seem to think that this report was just a bump in the road of a modest but solid recovery, while others seem to indicate that this is another reminder of the very fragile state of the broader economy.  Here’s a good summary of the highlights of the jobs report from The Wall Street Journal

 

Notes:

  1. Number of jobs promised by the Obama administration has varied between 3.5 – 4 million.  He promised 4 million early, and then started easing off on that.  I’m sticking with his original promise. (also “The road to 4 million” sounds a little better than “The road to 3.5 million). 
  2. The above is tracking only new jobs created / lost as tracked by the Department of Labor through its Bureau of Labor statistics.  Obama team has repeatedly said the 4 million represents jobs created or saved.  Since a “saved” job is highly subjective and can’t be calculated by any consistent standard, they are not accounted for above.
  3. Obama administration would likely dispute that the job losses from its early months should be held against them, but that is life in the big city when you’re President.  The last economic recession started in March 2001 when George W Bush had been in office for 1.5 months.  Democrats were only too eager to hang that around his neck (ignoring the fact that it is economically impossible to drive the economy into recession in that short a time period).  Also, it is only fair to assume that Obama’s pledge involves a net gain of 4 million jobs as of the point when his administration took charge.  We have now lost over 3 million jobs since he took office, and if we gain those back to end up where we started, I hardly think that fulfills his promise.
  4. Updates to continue monthly