Friday, December 3, 2010

NFP + 39,000, Unemployment Rate +9.8%

From the BLS:

The unemployment rate edged up to 9.8 percent in November, and nonfarm payroll employment was little changed (+39,000), the U.S. Bureau of Labor Statistics reported today. Temporary help services and health care continued to add jobs over the month, while employment fell in retail trade. Employment in most major industries changed little in November.

This is extremely disappointing, especially in light of the ADP employment numbers and the improving situation in the initial jobless claims market.

Let's start with the household survey.

The civilian labor force (the denominator in certain calculations) was essentially unchanged, moving from 153,904 to 154,007. The total employed decreased from 139,061 to 138,888, or a decrease of 173,000 This led to a decrease in the employment/population ratio from 58.3% to 58.2%. The total number of unemployed increased from 14,843 to 15,119, or an increase of 276,000. This lead to the increase in the unemployment rate from 9.6% to 0.8%. So, according to the household survey, there was a decrease in employment and an increase in unemployment over a steady sized population. Basically, this is the worst case scenario for the employment situation.

Let's move to the establishment survey:

Total private hiring increased 50,000. Goods producing industries decreased 15,000 while services increased 65,000. Most of this gain came from professional and business employment, which increased 53,000, while health care and education employment increased 30,000.

Average weekly hours were unchanged at 34.3 hours, but average hourly earnings increase a penny, which in turn increased average weekly earnings.

Again, this report is a big disappointment, especially considering the momentum increase in the employment situation. On a scale of 1 to 10, I'd give this report a 3. Some jobs were created and earnings did increase, but we're still stuck in the barely growing employment situation we were in before.

A note to commenter Bobby: the original post had far to many typos. Thanks for the catch and I will work on that in the future.