Friday, December 6, 2013

November AJSN: The Best Month in 2013 Brings the US to 19.3 Million Jobs Short

Monthly updates to the Bureau of Labor Statistics employment data this year have precipitated some overly positive reactions.  At times, commentators have waxed enthusiastic about a one-tenth-of-a-percent drop in the unemployment rate, even when it was accounted for nearly completely by people leaving the labor force.  The data, when examined beyond the headline jobless rate, has often turned out to be as robust as a fairgrounds haunted house, with nothing you would really like to see behind the façade. 

November, though, was legitimately good. 

Not only did seasonally-adjusted unemployment drop all the way from 7.3% to 7.0%, it was achieved without people pouring out of the working life.  The number of Americans with jobs rose over 600,000 to 144,775,000, and the number of those employed part-time for economic, as opposed to personal, reasons, which had been stuck at about 8,000,000, dropped 331,000 to reach 7.7 million.  Although the count of those saying they did not want a job went up over 300,000, most of the other AJSN components, specifically discouraged workers, people with ill health or disability, those not looking during the previous year, and those not immediately available, decreased.  Most stunning was the labor force actually increasing by 455,000, erasing two-thirds of last month’s fall and resulting in the labor force to population ratio rising to 58.6%.  The non-seasonally-adjusted unemployment rate plunged also, to 6.6%.

Overall, the American Job Shortage Number reached 19.33 million, its lowest since 2008, as follows:

Total Latent Demand % Latent Demand Total
Unemployed 10,271,000 90 9,243,900
Discouraged 762,000 90 685,800
Family Responsibilities 238,000 30 71,400
In School or Training 260,000 50 130,000
Ill Health or Disability 118,000 10 11,800
Other 718,000 30 215,400
Did Not Search for Work In  Previous Year 2,905,000 80 2,324,000
Not Available to Work Now 436,000 30 130,800
Do Not Want a Job 86,084,000 5 4,304,200
Non-Civilian, Institutionalized, and Unaccounted For, 15+ 9,501,768 10 950,177
American Expatriates 6,320,000 20 1,264,000
TOTAL     19,331,477
Over the past 12 months, the American jobs situation has improved substantially.  The November 2012 AJSN was 20.6 million, almost 1.3 million higher, with over 1.1 million more officially unemployed, more than 200,000 discouraged, and 442,000 more saying they had not searched for a job in the previous year. 

Not every number this morning was positive.  The stubborn count of 4.1 million jobless for 27 weeks or longer did not improve, and neither did the labor force participation rate of 63.0%.  The 358,000 additional deciding they did not want to work was half again the population increase, and the 203,000 rise in those employed, while good, was hardly the fundamental improvement that could have explained the large unemployment-rate drop.  Another statistic that may well do poorly today is the Dow Jones Industrial Average, if investors are scared that the Fed’s bond-buying stimulus will, despite Chairman Ben Bernanke’s revised 6.5% unemployment cutpoint, be reduced soon.    

Yet here we have something.  It’s way too soon to say the country’s getting back to work, let alone that the jobs crisis is over.  We still would need several years of months like this one, the best in half a decade, to achieve full employment.  But for once, the numbers in back, as well as the numbers in front, are encouraging.  

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