Stephanie
Diamond Member
- Jul 11, 2004
- 70,230
- 10,864
- 2,040
SNIP:
By Irwin Kellner, MarketWatch
PORT WASHINGTON, N.Y. (MarketWatch) If you want to know just how bad the labor market really is, then you need to multiply Septembers jobless rate by three.
For starters, lets recall that last months reported rate of unemployment was 7.8%. This was 0.3 points lower than in August and the lowest since the beginning of 2009. However, it was still a whopping three percentage points higher than the average rate posted in 2007.
In other words, Septembers unemployment rate may be better than a poke in the eye with a sharp stick, but it was not greeted with cheers by many households. This is because the reported jobless rate hides more than it reveals.
Kellner's ForecastsSee economic calendardate report forecast previous
Oct. 15 Retail sales 1.0% 0.9%
Oct. 15 Retail sales ex-autos 0.8% 0.8%
Oct. 15 Empire state index -5.0 -10.4
Oct.. 16 Consumer price index 0.5% 0.6%
Oct. 16 Core CPI 0.3% 0.1%
Oct. 16 Industrial production 0.2% -1.2%
Oct. 16 Home builders' index 41 40
Oct. 17 Housing starts 765,000 750,000
Oct. 18 Weekly jobless claims 347,000 339,000
Oct. 18 Leading indicators 0.2% -0.1%
Oct. 18 Philly Fed 1.0 -1.9
Oct. 19 Existing home sales 4.88 mln 4.82 mln
/conga/story/misc/kellners-forecast.html 230518
For one thing, the unemployment rate does not take into account discouraged workers. These are people who have stopped looking for work because they have been unemployed for so long, theyve given up. However, they would gladly take a job if one were offered.
In addition, those who have remained on the jobless rolls for over six months, the long-term unemployed, now make up 40% of the jobless. This is the highest percentage in over 60 years.
Then there are those who are working part-time but would prefer full-time employment. Others are employed as temps (without such benefits as health insurance, sick days, and so on) although they would rather have a permanent position.
Finally, in todays economy, it is necessary to take into account the fact that many folks are working beneath their education or skill levels for example, the former manager who now works as a clerk.
Add up all these categories and the true jobless rate is close to 25%. And when you consider that people are losing their jobs every day, even as others find work, you will find that as many as half of all households are being affected by the weak labor market each year.
As for jobs, less than half the nearly 9 million jobs lost in the last recession have been regained. By contrast, at this point in the three previous recoveries, all of the jobs lost during the prior recessions were recovered and then some.
Besides jobs, the middle class has suffered another serious blow during the past five years. The values of their two biggest holdings, homes and stocks, declined sharply and are today well below where they were at their peaks back in 2007.
To add insult to injury, the Federal Reserve, in the name of resuscitating the economy in order to drive down unemployment, has pushed interest rates down so low, they are for all intents and purposes zero. This is preventing seniors and others who have managed to build a nest egg from earning a safe return on their savings.
ALL of it here
Labor market is weaker than it looks - Irwin Kellner - MarketWatch
By Irwin Kellner, MarketWatch
PORT WASHINGTON, N.Y. (MarketWatch) If you want to know just how bad the labor market really is, then you need to multiply Septembers jobless rate by three.
For starters, lets recall that last months reported rate of unemployment was 7.8%. This was 0.3 points lower than in August and the lowest since the beginning of 2009. However, it was still a whopping three percentage points higher than the average rate posted in 2007.
In other words, Septembers unemployment rate may be better than a poke in the eye with a sharp stick, but it was not greeted with cheers by many households. This is because the reported jobless rate hides more than it reveals.
Kellner's ForecastsSee economic calendardate report forecast previous
Oct. 15 Retail sales 1.0% 0.9%
Oct. 15 Retail sales ex-autos 0.8% 0.8%
Oct. 15 Empire state index -5.0 -10.4
Oct.. 16 Consumer price index 0.5% 0.6%
Oct. 16 Core CPI 0.3% 0.1%
Oct. 16 Industrial production 0.2% -1.2%
Oct. 16 Home builders' index 41 40
Oct. 17 Housing starts 765,000 750,000
Oct. 18 Weekly jobless claims 347,000 339,000
Oct. 18 Leading indicators 0.2% -0.1%
Oct. 18 Philly Fed 1.0 -1.9
Oct. 19 Existing home sales 4.88 mln 4.82 mln
/conga/story/misc/kellners-forecast.html 230518
For one thing, the unemployment rate does not take into account discouraged workers. These are people who have stopped looking for work because they have been unemployed for so long, theyve given up. However, they would gladly take a job if one were offered.
In addition, those who have remained on the jobless rolls for over six months, the long-term unemployed, now make up 40% of the jobless. This is the highest percentage in over 60 years.
Then there are those who are working part-time but would prefer full-time employment. Others are employed as temps (without such benefits as health insurance, sick days, and so on) although they would rather have a permanent position.
Finally, in todays economy, it is necessary to take into account the fact that many folks are working beneath their education or skill levels for example, the former manager who now works as a clerk.
Add up all these categories and the true jobless rate is close to 25%. And when you consider that people are losing their jobs every day, even as others find work, you will find that as many as half of all households are being affected by the weak labor market each year.
As for jobs, less than half the nearly 9 million jobs lost in the last recession have been regained. By contrast, at this point in the three previous recoveries, all of the jobs lost during the prior recessions were recovered and then some.
Besides jobs, the middle class has suffered another serious blow during the past five years. The values of their two biggest holdings, homes and stocks, declined sharply and are today well below where they were at their peaks back in 2007.
To add insult to injury, the Federal Reserve, in the name of resuscitating the economy in order to drive down unemployment, has pushed interest rates down so low, they are for all intents and purposes zero. This is preventing seniors and others who have managed to build a nest egg from earning a safe return on their savings.
ALL of it here
Labor market is weaker than it looks - Irwin Kellner - MarketWatch