http://www.infowars.com/another-phony-employment-report/

Another Phony Employment Report

Paul Craig RobertsInfowars.com
Oct 6, 2012

October 5. Today’s employment report from the Bureau of Labor Statistics shows 114,000 new jobs in September and a drop in the rate of unemployment from 8.1% to 7.8%. As 114,000 new jobs are not sufficient to stay even with population growth, the drop in the unemployment rate is the result of not counting discouraged workers who are defined away as “not in the labor force.”

According to the BLS, “In September, 2.5 million persons were marginally attached to the labor force.” These individuals “wanted and were available for work,” but “they were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.”

In other words, 2.5 million unemployed Americans were not counted as unemployed.

The stock market rose on the phony good news. Bloomberg’s headline: “U.S. Stocks Rise as Unemployment Rate Unexpectedly Drops,” http://www.bloomberg.com/news/2012-10-05/u-s-stock-futures-little-changed-before-payrolls-report.html .

A truer picture of the dire employment situation is provided by the 600,000 rise over the previous month in involuntary part-time workers. According to the BLS, “These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.”

Turning to the 114,000 new jobs, once again the jobs are concentrated in lowly paid domestic service jobs that cannot be offshored. Manufacturing jobs declined by 16,000.

As has been the case for a decade, two categories–health care and social assistance (primarily ambulatory health care services) and waitresses and bartenders account for 53% of the new jobs. The BLS never ceases to find ever growing employment of people in restaurants and bars despite the rising dependence of the US population on food stamps. The elderly are rising as a percentage of the American population, but I sometimes wonder if employment in ambulatory health care services is rising faster than the elderly population. Whether these reported jobs are real, I do not know.

The rest of the new jobs were accounted for by retail trade, transportation and warehousing, financial activities (primarily credit intermediation), professional and business services (primarily administrative and waste services), and state government education, where the 13,600 reported new jobs seem odd in light of the teacher layoffs and rise in classroom size.

The high-tech jobs that economists promised would be our reward for offshoring American manufacturing jobs and tradeable professional services, such as software engineering and IT, have never materialized. “The New Economy” was just another hoax, like “Iraqi weapons of mass destruction” and “Iranian nukes.”

While employment falters, the consumer price index (CPI-U) in August increased 0.6 percent, the largest since June 2009. If the August rate is annualized, it means bad news on the inflation front. Instead of bringing us high tech jobs, is “the New Economy” bringing back the stagflation of the late 1970s? Time will tell.

and....

http://soberlook.com/2012/10/trying-to-make-sense-of-todays.html?utm_source=BP_recent

FRIDAY, OCTOBER 5, 2012

Trying to make sense of today's employment numbers

It is difficult to explain today's employment report from the Bureau of Labor Statistics. Back to school distortions, changes in temporary employment, and early harvest - all potentially distorted the results. Many of the numbers reported should be taken with a grain of salt. Here are some observations:

1. The headline unemployment number dropped to the lowest level since early 09 and was a complete surprise to the forecasters.

US headline unemployment rate (Bloomberg)

2. In response, the Obama re-election odds on Intrade spiked, recovering some ground lost after the debates. Clearly the President's campaign strategists will use this to their advantage.

Source: Intrade

The Fed will also likely use this result to claim that it is the result of the central bank's expansionary policy.

3. It's unclear however where this sudden improvement in the unemployment rate came from. In the past big declines were the result of decreasing labor participation. But the Employment to Population ratio actually ticked up this month.

4. Some are pointing to the big spike in US Employment Total in Labor Force of 873K as an explanation for this decline in the unemployment rate. But that number is notoriously volatile and difficult to adjust for back to school seasonality. The chart below compares the US Employment Total in Labor Force survey (white) with the non-farm payroll changes (yellow). The survey has basically fluctuated - sometimes wildly - around the payrolls data, but on average followed payrolls closely. And payrolls growth continues to be anemic - certainly not enough to explain the drop in the unemployment rate.

US Employment Total in Labor Force survey (white) vs.
non-farm payrolls (yellow)
5. Part-time jobs classified as "for non-economic reasons" have declined by 260K while we saw a 582K jump in part-time employment for "economic reasons" (defined as "those who worked 1 to 34 hours during the reference week for an economic reason such as slack work or unfavorable business conditions, inability to find full-time work, or seasonal declines in demand"). It seems this may be part of the explanation for the lower unemployment rate, though it does not bode well for the US labor markets.

Part-time payrolls for "economic" (white) vs. "non-economic" reasons (yellow).
6. There may be another factor at work. Because of the severe summer drought, many crops had to be harvested early and quickly (since crops matured early) - with a big percentage of them used to make feed. There is anecdotal evidence that many who take farm work on a part-time/temp basis have seen heavier workloads on the farm, which would normally show up in government statistics later in the year. Some people therefore no longer show up in the unemployment number, yet the farm payrolls are not included in September's non-farm payroll report. Harvesting will be completed by Halloween rather than Thanksgiving this year, making seasonal adjustments for this shift between farm and non-farm demand more difficult. Of course this effect will be reversed later in the year.

7. And of course some high profile commentators are saying the numbers were simply cooked.

http://market-ticker.org/akcs-www?post=212379

Employment Report: +114k

Look what we have here!

The unemployment rate decreased to 7.8 percent in September, and total nonfarm payroll employment rose by 114,000, the U.S. Bureau of Labor Statistics reported today. Employment increased in health care and in transportation and warehousing but changed little in most other major industries.
This is rather amusing; +114,000 is fewer than the working-age population growth in the household survey (206,000) and yet unemployment decreased.
Huh?
The household survey's unadjusted numbers, however, show some rather interesting figures, none of which make sense. "Not in labor force" increased by 386,000 while "employed" increased by 775,000 a net change off "unemployed and looking" of well north of a million people!
But -- giving up is not the same thing as finding a job.

Overall we're adding jobs, but not enough to cover the additions to the workforce. And while the unemployment rate decreased a big part of it came from those who gave up, which is a false number, but heh, who's counting, right?

This figure keeps going up in a stairstep fashion and simply isn't good. Not-in-labor-force has to come down if we're going to see real job progress -- that's all there is to it.

This is what employment looks like ex-work force changes. And again, while this report isn't a disaster, the fact remains that ex-population changes it remains negative -- although not ridiculously so. Nonetheless and in spite of the ridiculous levels of "stimulus" we're not obtaining actual job market improvement.

A nice little blip upward in this last chart is evident, but does it matter? Nope. We're still scraping along the bottom.

One disturbing thing that has shown up in the data is the skew between education and employment. For those who are contemplating how far to go with their education this is not what you want to see at all.

The lesson in here? Be educated but don't be too educated. My suspicion is that the deterioration here is related to the "requirements" for salary that come with the ridiculous amount of debt kids are being asked to take on.
Another interesting factoid is found in the unemployment duration distribution -- it improved on an annualized basis but the shift in the last month is not good at all, with nearly three weeks of duration being added in just the last month to average duration, which strongly implies that those who went to work this month were all recent lay-offs and not those who have been unemployed. This, incidentally, argues directly against Bernanke's assertion that the unemployment problem has not become structural.

One final note -- workweek and hourly earnings were down for the transportation sector, which was an outlier.
Hmmmmm....

and the report from BLS

additional items of note - Household survey found employment rose by 873,000 ( versus the establishment survey )

U-6 at 14.7 ( no change month over month , as compared with headline number of 7.8 for employment )

http://bls.gov/news.release/empsit.nr0.htm

Economic News Release

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PRINT:

CPS

CES

Employment Situation Summary

Transmission of material in this release is embargoed                   USDL-12-1981
until 8:30 a.m. (EDT) Friday, October 5, 2012

Technical information:
 Household data:       (202) 691-6378  *  cpsinfo@bls.gov  *  www.bls.gov/cps
 Establishment data:   (202) 691-6555  *  cesinfo@bls.gov  *  www.bls.gov/ces

Media contact:         (202) 691-5902  *  PressOffice@bls.gov


                    THE EMPLOYMENT SITUATION -- SEPTEMBER 2012


The unemployment rate decreased to 7.8 percent in September, and total nonfarm 
payroll employment rose by 114,000, the U.S. Bureau of Labor Statistics reported 
today. Employment increased in health care and in transportation and warehousing 
but changed little in most other major industries.

Household Survey Data

The unemployment rate declined by 0.3 percentage point to 7.8 percent in September. 
For the first 8 months of the year, the rate held within a narrow range of 8.1 
and 8.3 percent. The number of unemployed persons, at 12.1 million, decreased by 
456,000 in September. (See table A-1.)

Among the major worker groups, the unemployment rates for adult men (7.3 percent), 
adult women (7.0 percent), and whites (7.0 percent) declined over the month. 
The unemployment rates for teenagers (23.7 percent), blacks (13.4 percent), and 
Hispanics (9.9 percent) were little changed. The jobless rate for Asians, at 
4.8 percent (not seasonally adjusted), fell over the year. (See tables A-1, A-2, 
and A-3.)

In September, the number of job losers and persons who completed temporary jobs 
decreased by 468,000 to 6.5 million. (See table A-11.)

The number of persons unemployed for less than 5 weeks declined by 302,000 over

the month to 2.5 million. The number of long-term unemployed (those jobless for 
27 weeks or more) was little changed at 4.8 million and accounted for 40.1 
percent of the unemployed. (See table A-12.)

Total employment rose by 873,000 in September, following 3 months of little 
change. The employment-population ratio increased by 0.4 percentage point to 
58.7 percent, after edging down in the prior 2 months. The overall trend in 
the employment-population ratio for this year has been flat. The civilian labor 
force rose by 418,000 to 155.1 million in September, while the labor force 
participation rate was little changed at 63.6 percent. (See table A-1.)

The number of persons employed part time for economic reasons (sometimes 
referred to as involuntary part-time workers) rose from 8.0 million in August 
to 8.6 million in September. These individuals were working part time because 
their hours had been cut back or because they were unable to find a full-time 
job. (See table A-8.)

In September, 2.5 million persons were marginally attached to the labor force, 
essentially unchanged from a year earlier. (These data are not seasonally 
adjusted.) These individuals were not in the labor force, wanted and were 
available for work, and had looked for a job sometime in the prior 12 months. 
They were not counted as unemployed because they had not searched for work 
in the 4 weeks preceding the survey. (See table A-16.)

Among the marginally attached, there were 802,000 discouraged workers in 
September, a decline of 235,000 from a year earlier. (These data are not 
seasonally adjusted.) Discouraged workers are persons not currently looking 
for work because they believe no jobs are available for them. The remaining 
1.7 million persons marginally attached to the labor force in September had 
not searched for work in the 4 weeks preceding the survey for reasons such 
as school attendance or family responsibilities. (See table A-16.)

Establishment Survey Data

Total nonfarm payroll employment increased by 114,000 in September. In 2012, 
employment growth has averaged 146,000 per month, compared with an average 
monthly gain of 153,000 in 2011. In September, employment rose in health care 
and in transportation and warehousing. (See table B-1.)

Health care added 44,000 jobs in September. Job gains continued in ambulatory 
health care services (+30,000) and hospitals (+8,000). Over the past year,

employment in health care has risen by 295,000.

In September, employment increased by 17,000 in transportation and warehousing. 
Within the industry, there were job gains in transit and ground passenger 
transportation (+9,000) and in warehousing and storage (+4,000).

Employment in financial activities edged up in September (+13,000), reflecting 
modest job growth in credit intermediation (+6,000) and real estate (+7,000).

Manufacturing employment edged down in September (-16,000). On net, manufacturing 
employment has been unchanged since April. In September, job losses occurred 
in computer and electronic products (-6,000) and in printing and related 
activities (-3,000).

Employment in other major industries, including mining and logging, construction, 
wholesale trade, retail trade, information, professional and business services, 
leisure and hospitality, and government, showed little change over the month.

The average workweek for all employees on private nonfarm payrolls edged up by 
0.1 hour to 34.5 hours in September. The manufacturing workweek edged up by 
0.1 hour to 40.6 hours, and factory overtime was unchanged at 3.2 hours. 
The average workweek for production and nonsupervisory employees on private 
nonfarm payrolls was unchanged at 33.7 hours. (See tables B-2 and B-7.)

In September, average hourly earnings for all employees on private nonfarm 
payrolls rose by 7 cents to $23.58. Over the past 12 months, average hourly 
earnings have risen by 1.8 percent. In September, average hourly earnings of 
private-sector production and nonsupervisory employees increased by 5 cents 
to $19.81. (See tables B-3 and B-8.)

The change in total nonfarm payroll employment for July was revised from 
+141,000 to +181,000, and the change for August was revised from +96,000 to 
+142,000.

Catharsis Ours

Friday, October 5, 2012