In the last few days since the release of the official employment number for January, there have been a variety of jobs related articles I’ve found as I surf through various news sites and the articles have been all over the map in conclusions. Some of the articles have even recognized that things really aren’t getting better for the long term un and under employed while others keep trying to provide more spin at things getting better.
Saturday’s (Feb 4, 2011) NY Times had Floyd Norris attempting to reconcile the weak job creation numbers withe the drop in the official Unemployment Rate. His conclusion shows just how ef’fed up the numbers are:
Over all, from January 1979 through March 2010, the first estimate was off — either higher or lower — from the final figure by a median of 74,000 jobs. If that holds true now, there is a 50 percent chance that the final number for January will be somewhere between a loss of 38,000 and a gain of 110,000. And there is an equal chance that it will be outside that range.
None of that reduces the importance of jobs data, particularly in the months after a recession ends. But it does serve as a reminder that the first attempt at estimating employment is far from authoritative.
Of course, there’s Catherine Rampell in today’s (Tuesday Feb 8) Economix blog from the NY Times showing there are still nearly five applicants for each job:
During the recession, the pain in the job market was initially caused by a surge in layoffs. More recently, layoffs have returned to their recession levels before the recession, and the problem instead has become a reluctance to hire workers (including, of course, the millions laid off during the recession). This can be seen in the disappointing trends in job openings and new hires.
In July 2009, right after the recession officially ended, the ratio of unemployed workers to job openings peaked at 6.3. It has fallen since, to about 4.7 in both November and December of 2010. That’s better, of course, but it’s still historically high and doesn’t provide much hope that the labor market can quickly absorb the nation’s millions of idle workers.
As a companion to the above, the Labor Department reported that in December the number of job openings fell (via Reuters) though the spin is that it is getting better because there weren’t quite as many lay-offs:
U.S. job openings slipped in December, a government report showed on Tuesday, but a decline in layoffs supported views of a gradual labor market recovery.
Job openings, a measure of labor demand, eased 139,000 to a seasonally adjusted 3.1 million, the Labor Department said in its monthly Job Openings and Labor Turnover Survey.
The job openings rate — a gauge of how many jobs were still open at the end of the month — fell to 2.3 percent from 2.4 percent in November. Job openings have risen about 31 percent from their record low in July 2009.
The Boston Globe had an article on Saturday Feb 5 about firms in the Boston area using lay-offs as a means to boost stock prices and make themselves less appealing as take over targets. Once again, one of the most salient points is at the end of the article:
It is difficult to know whether such companies would have cut workers if they weren’t under outside pressure. Even after being sold, companies are often forced to make cuts. Anheuser-Busch, for example, was sold before its executives carried through on the cost cuts, but InBev wound up eliminating 1,400 US workers after the deal.
Outside observers said it is usually impossible to tell whether takeover candidates are making sound business moves or inadvertently sabotaging their future business in a panicked effort to bolster shares and fight off a takeover.
That article combines with this from MSNBC yesterday:
The U.S. manufacturing sector is roaring back after the worst recession in generations. So why aren’t factory jobs coming back as quickly?
One big reason: Business executives like Drew Greenblatt, owner of Baltimore-based Marlin Steel Wire Products, have figured out how to make more widgets with the same number of workers. To do so, he’s had to upgrade the skills — and wages — of his employees. But his profits are bigger than ever.
This leads us to President Obama’s speech to the Chamber of Commerce yesterday, February 7 (via the NY Times The Caucus):
President Obama urged American businesses on Monday to “get in the game” by letting loose trillions of dollars being held in reserves, saying that they can help create a “virtuous cycle” of more sales, higher demand and greater profits that will put people back to work and turn around the sluggish economy.
“If there is a reason you don’t believe that this is the time to get off the sidelines — to hire and invest — I want to know about it. I want to fix it,” Mr. Obama said in a speech to business leaders at the U.S. Chamber of Commerce.
Noble sentiments to be sure. Yet not helped at all when the President of the Richmond, VA Federal Reserve Bank proclaims (via Reuters) that things are “getting better” so the Fed should abandon efforts at stimulus:
The Federal Reserve should seriously consider pulling back on its $600 billion stimulus program given stronger growth and a brighter jobs picture, Richmond Fed President Jeffrey Lacker said on Tuesday.
Despite a report last week showing only 36,000 jobs were created in January, Lacker said other measures were pointing to a firmer economic recovery and better employment prospects.
Fortunately, the BenBernank, while not doing much, at least seems to recognize that doing as Mr Lacker recommends might not be a good idea:
Fed Chairman Ben Bernanke made clear in remarks last week he does not consider progress on jobs sufficient to declare victory and begin withdrawing monetary support.
With all the millions of people un and under employed, it is rather astounding that there are states willing to forego Federal Unemployment aid for extended benefits (via Yahoo)
Despite record levels of long-term unemployment, some states are choosing to walk away from a total of almost $1 billion in federal jobless benefits, according to a new report (pdf).
The 2009 American Reinvestment and Recovery Act, better known as the stimulus law, extends unemployment benefits to the fast-growing number of Americans who have been without work for six months or more. In addition to helping the jobless, the federal funds offer a much-needed economic stimulus for states.
So apparently these states must believe that a miracle will occur.
For what it’s worth, MSNBC’s Alison Linn had a report today on the affects for long term unemployed when they do finally find employment:
The recession and its aftermath have been brutal for jobseekers, not just because there are so many of them but also because it is taking them so long — an average of nearly nine months — to find new work.
As the economy starts slowly to add jobs again, many of those who are finding a job again say the psychological relief of returning to work is as important as the paycheck.
All that any of the long term un and under employed (including myself) have asked is for a modicum of support while searching for a position in our fields and the opportunity to be a productive member of the work force. Is that so much to ask?
And because I can:
Cross posted from Just A Small Town Country Boy