Thursday, July 3, 2008

Job situation continues to deteriorate

The June 2008 employment figures are out, and the news isn't good.

The seasonally-adjusted unemployment rate held steady last month at 5.5 percent. That's nearly a full percentage point higher than the rate last June and up half a percentage point since the start of the year.

The bad news, however, comes in the numbers behind this number. The number of employed people and the number of jobs (these are measured in separate surveys) each fell, while the number of people who were unemployed (out of work but looking for a job) rose.

How then did the unemployment rate stay steady? The number of people who indicate that they "in the labor force" (people either working or looking for work) fell. The unemployment rate is calculated by dividing the number of people looking for work by the number of people in the labor force. The labor force number fell just enough to keep the measured unemployment rate steady.

Jobs disappearing and people leaving the labor force are not good economic signs. While we may yet dodge a full-blown economic recession, it is clear that we are well into an employment recession.

4 comments:

Doug Johnson said...

Until we solve our energy problem expect this to expand. Its should appear even to the most radical left wing person by now, that Pelosi common sense plan for lowering gas prices has failed. Well maybe not exactly it did get a bunch of liberals elected on this promise. I wonder where all the liberal press that glorified Pelosi plan are now. In fact what the hell was her plan?

Dave Ribar said...

You're right that the run up in energy prices has hurt employment levels (though I would throw the housing and financial crises in as well).

A watered-down version (by Republicans and some rust-belt Democrats) of Pelosi's energy plan did make it through the Congress at the end of 2007 (HR 6). Their plan, which calls for higher CAFE standards among other things, should help in the long run. If the Republicans weren't so busy setting a record for filibusters in the Senate, we might have seen action on this sooner.

Many contributors to higher prices, such as growing demand from China and India, are out of the government's hands. Other important contributors, such as the security premium associated with our war with Iraq and saber-rattling with Iran and the decrease in the dollar, reflect administration actions. Your complaints about oil prices would be more fairly directed at President Bush.

Doug Johnson said...

Not so Ribar, I have a great interest in the country, you have a great interest in liberalism in my opinion. I have plenty of dislike for both parties. I have read so much BS from folks that know nothing of oil drilling. We have know for 40 years this was coming, yet we have sit on our butts and did nothing. We should have been drilling in the Carter years. I am for all forms of energy and all forms saving energy. Give you two examples of left wing thinking the Kennedys are for wind farms, yet they will not allow hem in their back yard. I was in Atlantic City a few years ago, they have about 6 of these wind generators. The tree huggers were raising hell because they were killing bats. The best way out is drilling, then we should expand other ways and quickly. I have cut my gas consumption by over 20%, in return this has cut my spending. Which hurts the economy. Pelosi, has lied to the Americans, and now he liberals that praised her before the 2006 election, now want to ignore her lie. She can get all the press she wants to push her plan. Much like the Duke Case, once the LIBERALS get there votes, the press goes into hiding.

Dave Ribar said...

I agree that the protests against the wind farm off the Mass. cost is hypocritical in the extreme.

However, there is much Republican hypocrisy in the drilling mess. Oil and gas exploration in the Outer Continental Shelf have been prohibited for the last 17 years due to an executive order that the first President Bush signed and that the current President Bush could revoke ANYTIME he wished (it could have been done immediately upon entering office). No Congressional action is required whatsoever.

BTW, Sen. McCain also opposed coastal drilling until at least 2006, when he switched his position.