Employment Level Falls for 3rd Straight Month in July

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

As reported by the Bureau of Labor Statistics this morning (link to the report provided above), the economy shed 131,000 jobs in July while the unemployment rate held steady at 9.5%.  (Already sounds a little fishy, doesn’t it?)  It was expected that this report would show a net loss of jobs because of the exodus of census workers, but the loss was bigger than expected because of weaker-than-expected hiring in the private sector.

Dig into the details and you’ll find that the news is even worse.  The unemployment rate held steady at 9.5% thanks to another 181,000 workers mysteriously vanishing from the labor force in spite of the fact that population growth piled on another 120,000 workers.  Worst of all is that the employment level fell by another 159,000 workers – the third straight monthly decline.  The employment level is now little changed from its level exactly one year ago in July. 

If we hold the labor force at a steady percentage of the population, the real unemployment rate actually rose in July by 0.2% to 11.7%, while the more inclusive measure, U6, rose to 20.7%.  The number of unemployed Americans rose by almost 300,000 to 18.377 million. 

Here’s the calculation and the charts:

Unemployment Calculation

Unemployment Chart

Unemployed Americans

Labor Force & Employment Level

Here’s a summary of job gains/losses in various sectors of the economy in July (extracted from the BLS report):

  • Manufacturing:  + 36,000
  • Health care:  + 27,000
  • Transportation & Warehousing:  + 12,000
  • Mining:  + 7,000
  • Construction:  – 11,000
  • Professional & business services:  – 13,000
  • Financial services:  – 17,000
  • Government:  – 202,000

Manufacturing continues to be a bright spot, but at far too slow a pace.  And much of this hiring has been due to inventory rebuilding, which can’t go on forever.

The U.S. tends to think of itself as a “services” economy.  If that’s true, the trend in services employment isn’t a good omen. 

Is it any wonder that the reported departure of Christine Romer from the president’s economic team comes on the same morning that this report was released?  Heads have started to roll.  Look for Larry Summers to be the next one to leave.  After all, the president has to at least appear to be doing something, right?

And let’s not forget that, regardless of how you feel about the “stimulus plan,” that spending has no doubt propped up employment.  And that stimulus spending will soon be coming to an end.  Then what?  Look for the employment picture to get even uglier unless the president comes up with a new stimulus plan or unless he actually does something to fix our incredibly stupid trade policy.  But that’s not going to happen. 

If you have a job out there, you’d better hold on tight.

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21 Responses to Employment Level Falls for 3rd Straight Month in July

  1. Henry says:

    So it all that 200k for government census workers.

    • Pete Murphy says:

      Most of it was – about 143,000. The report says only: “Government employment fell by 202,000 in July, largely reflecting the loss of
      143,000 temporary workers hired for Census 2010. Employment in both state and
      local governments edged down over the month.”

  2. hungry4food says:

    they want GOV Jobs because they Can control their actions and Appease the Environmentalists Marxist Organizations their largest donors groups .

    Its all because they see this coming and want to herd the sheeple into control / contain environments ……

    http://en.wikipedia.org/wiki/Carrying_capacity

    http://jayhanson.us/america.htm

    http://science.howstuffworks.com/environmental/green-science/earth-carrying-capacity1.htm

    http://dieoff.org/index.html
    Water Shortages in the world and USA is whats driving the elite to hoard and consolidate wealth and resources and write restrictive regulatory policies that will ration and limit the majority of the populations activities as the freedom train comes grinding to a halt .

    Wake up and realize Exactly what happens once we run out of water?
    http://www.azcentral.com/arizonarepublic/news/articles/2010/07/21/20100721climate-shift-to-hurt-water-supply.html#comments
    http://science.howstuffworks.com/environmental/earth/geophysics/run-out-of-water.htm
    http://www.marketskeptics.com/2010/04/time-water-running-out-for-americas.html

    http://news.nationalgeographic.com/news/2010/05/100505-fossil-water-radioactive-science-environment/

    • Pete Murphy says:

      Hungry, the inclusion of so many links is what delayed the publishing of your comment.

      Also, please stay on topic. The comments about water, whether right or wrong, aren’t relevant to the subject of unemployment. In the future, I may edit out off-topic soap-boxing. Such comments would be more relevant on posts about overpopulation.

  3. MikeF says:

    Pete,
    Nice job of producing numbers that have not been thoroughly cooked down my Government Math. My prediction the U.S. will never see full employment again seems to be sound, considering our current and past leadership.

    State and local governments will continue to shed jobs unless the feds loan them money to keep the good ships (46 states are bleeding red ink) afloat. Doing so, in my opinion, is a slight of hand trick to avoid the balanced budget requirement that the states are subject to.

    The most amazing part of this is the lack of recognition that ONLY sustainable base employment and the associated tax collection can fund government at the necessary levels.

    We have borrowed our economy by increasing debt at every level since 1969 and have now reached the point of diminishing returns for a global economy where the cheapest bid wins the contract. Surprise, surprise.

  4. hungry4food says:

    3 Links that will Blow your Mind ….

    http://commentaryandanalysis.mining.com/2010/08/06/war-is-coming/ – There is a lot of Interesting stuff here to read .

    http://commentaryandanalysis.mining.com/2010/08/06/gold-forecaster-if-the-us-dollar-were-to-fall-how-important-is-gold-to-the-states/ – This talks about a scenario that could play out .

    http://www.mineweb.com/mineweb/view/mineweb/en/page103855?oid=109361&sn=Detail – This story tell a very Dark Economic Outlook .

  5. MikeF says:

    Hungry,

    I know that you asked Pete, but I’ll throw in my opinion. First, what you are challenging is the current rules of unbridled Capitalism and suggesting that Capitalism Lite is available. It isn’t.

    Secondly, the article assumes that economic growth beyond our current $14 TRILLION GDP is both possible and desirable. I suggest that both are false paradigms when measured against a finite environment.

    Thirdly, the article makes a clever unwritten statement that funding government at the current levels is a given. Nothing could be further from the truth.

    • hungry4food says:

      Mike ,is what you are saying is Collectivism is the only option left ?

      • hungry4food says:

        When researching the term collectivism , http://en.wikipedia.org/wiki/Collectivism , the idea that this would be a better way of life over the Individualism method , is worthy of debate because the most efficient utilization of matter is accomplished in the individual struggles of achievement , rather than the collective , because there is a pecking order that exists in the collective and if the political element is dominate in the order , the classes down the ladder suffer the more this trend evolves in the process of resource consolidation , if shortages are what transpires , history shows the Gulags born this truth , so to reject the idea of individualism is a slippery slope we might not want to wish for ……

        The problem I think we have seen evolve that gave us the worse inequality is the Multi-national Corporate dominance over Free Trade agreements and the use of them to Manipulate the manufacturing of Goods and some services because of the Lobbying in Washington to not hold to account the currency manipulators like China that should have seen their currency float tremendously higher over the past 16 years in free floating currency rules as the production was shifted over to their side of the pond . Even our trade and Treasury Representatives have said they would hold them to account for this over the years , but nothing was done , but this would have kept a larger percentage of work here in the USA and Europe , and we would have seen a better wage stabilization from it , but now its a lost cause because we have run this into such high deficits that the scenario thats coming is spelled out in this link ; http://www.mineweb.com/mineweb/view/mineweb/en/page103855?oid=109361&sn=Detail

        The Individual can produce the most efficiently , its because our Government allowed the Corporate to collect the independent markets away from the individual is why we see the inequality in our way of life today , and the Government did it on purpose because now look how easy by default they can take over what we gain our Independence from ?????

    • hungry4food says:

      MikeF , The Reason Why we have economic stall and Job Creation in the USA
      The cause of free market economic collapse is due to the private risk takers fear of over regulation due to a Government fear of over population evolution in the world today . We are witnessing history repeat itself only on a grand scale of worldwide portions . This time was Planned in 1974, http://www.population-security.org/11CH3.html ,
      Here we see how the elite use Foundations as a way to hoard their wealth and continue to consolidate the resources away from the access of the general population all under the law of Government , you saw the 40 Richest announce this last week what they plan on doing , give half of their personal wealth away , just they didn’t say to what , but I bet its still in their control , and it will not be directed towards a benefit of population Expansion ;
      http://gulagbound.com/1624/meet-your-mentor-mr-norman-dodd , and the plan evolved , and the plan is Now in todays light expressed here in these links ,
      http://economix.blogs.nytimes.com/2010/07/26/armageddon-wars-overpopulation-vs-global-warming/?src=busln

      http://www.youtube.com/view_play_list?p=6A1FD147A45EF50D

      Wake Up and Get Ready to just try and Survive ……

      • Pete Murphy says:

        Hungry, just a reminder that the inclusion of two or more links lands your comment in limbo until I’ve had a chance to review it. An anti-spam feature.

      • hungry4food says:

        OK Pete . I think that the struggles with unemployment and the decline in Jobs , prosperity driven by a supply-side fundamental philosophy are entering into a permentant decline , because of worldwide overpopulation relative to the world finite supply of resources .
        Take a look at this link I think you have seen it before , but understanding what the top agronomist is saying in these links ; http://en.wikipedia.org/wiki/Norman_Borlaug , is achievable only if one thing we were not coming up short of , potable water to keep up with a growing population . http://www.ihavenet.com/Norman-Borlaug-Population-Growth-Requires-Second-Green-Revolution.html , the idea that some Climate Change policy will return us to a level of fresh water supply that takes away this urgency for increased supply is a shot in the dark at a topic thats just a speculation of reducing a loss of water , but at a rate that is not measured at any level , but population keeps growing at numbers that we can measure , and those numbers are unsustainable if a number of water gallaons saved by Climate change can be understaood . I would rather try and tap the Ocean and make sure we have some level of resource to work with , but unless something is done , Like a Control on population in the 3rd world , which will cause conflict from this restriction among the societies that hold beliefs that are 180 degrees of this , the topic becomes troubling . Check out this website too , it tells you a story about where in the world education about this overpopulation debate is having results , and the economic system behind these nations is capitalism , so that means that the Education and capitalism work good together in this manner . https://www.cia.gov/library/publications/the-world-factbook/rankorder/2127rank.html
        Like I said before , the problem is The Multi-National Corporate collusion with Government thats causing the inequality issue in our society , in my Opinion and I think its being done for the reason of wealth consolidation and confiscation to install a new economic Order because of the fear of what we see , unsustainable world population , and the ability for current infrastructures and access resources to supply the near future needs .

        Unless the oceans are tapped and desalination becomes our new frontier in the development of this resource and feed into the pipelines of our infrastructures worldwide , and create new growing infrastructures like this ; http://www.verticalfarm.com and , http://www.ecoloblue.com/ , we are in for struggles due to a lack of these vital needs . I am convinced that this is why the Governments dried up the credit in the world , stopping growth in supply-side fundamentals , and are now drafting and implementing legislation that is redirecting how the resources in the world will be used , and at what rate , or ration .

      • Pete Murphy says:

        Hungry, first of all, regarding your first sentence, I agree wholeheartedly that the root cause of our economic decline is overpopulation. But I differ on the reason. Though there is plenty of reason for concern that resources are inadequate to support a growing population (including water), no resource shortage has yet proven to be a limit to population growth, except perhaps in some localized areas. The world’s population continues to grow at a near-record pace.

        I’m not trying to discount your point about resources. I share your concern. But economists are quick to shrug off such concerns with the assertion that through conservation, recycling, substitution and good old human ingenuity, man can stretch resource supplies indefinitely. I know, it’s blatantly obvious that they’re wrong, but there’s no way to argue with such an obvious breach of logic.

        What I’m all about here is to inject a new dimension into the overpopulation debate – that regardless of whether or not resources prove to be limitations, there’s a very solid economic reason for limiting our population. And this is where I differ with you on the reason for our current economic decline. Through worsening over-crowding, we’re eroding our ability to own and employ products that define a high standard of living. Thus, per capita consumption is declining. But while per capita consumption is declining, productivity (or per capita output) is always rising. The result is absolutely inescapable – rising unemployment! This effect is exacerbated for the U.S. by attempting to trade freely with nations that are grossly overpopulated. I could go on, but I’d simply be repeating stuff you can find elsewhere on this blog.

        Those of us who are concerned about overpopulation from a resource perspective have a great case to make and I hope that you keep up the pressure on our leaders and legislators to begin listening to reason. (Mike Folkerth is also an expert on this subject and I hope that you’re visiting his blog too.)

        Meanwhile, I’ll keep working on this new front, trying to get economists to see that their reliance on technology to push back the limits of resources is pointless, because the over-crowding effect will ruin the economy anyway.

      • hungry4food says:

        I understand Pete what you are doing , my only thing I guess is that its obvious that the top Financial Firms that guarantee the lending arena are MIA , and I believe its because they are being dictated too by the Environmentalist organizations , Hank Paulson , Ex US Treasury Boss ex CEO Boss of Goldman is also Ex CEO of Nature Conservancy , and still active in the organization , see a pattern ?? , but these organizations have shut down supply-side fundamentals and the Wall Street Gangs are still trying to lure people into the markets and the trend is deflation with these Gangs in Government running the Policies , and its causing people to lose they lifes work , all in the name of getting ahead , and I think it is all a plan to consolidate and confiscate the wealth and leave everyone begging the Government , and they will have accomplished their goal of control , because first you have to gain control of the free market , then you have the people’s liberty in the palm of your hand . Its seems so obvious with all the information out there on Overpopulation by these same outfits that the regulators have such close relationships with …… I am just saying , people need to think about this and be questioning any investment and fund manager about their views on this topic of Governments association with Environmentalist Organizations , how they are connected with regulations in Government administrating policies and the effects this is having on the capital markets and the supply-side fundamentals . Pete what do you think about this effecting your view of the economic fundamental you are driving at here ? Don’t you think this has major implications on how the system is creating the inequalities we see , like it is planned , so they can by proxy collapse the capital system but not look like the cause ???

      • Pete Murphy says:

        Hungry, no doubt there’s some validity to what you’re saying. Just this morning, the following article appeared in the Wall Street Journal: http://finance.yahoo.com/family-home/article/110258/us-economy-is-increasingly-tied-to-the-rich

        But I’m afraid I’m busy enough with the population density angle. I’ll leave it to others to raise the very valid concerns about the U.S. becoming a plutonomy.

      • hungry4food says:

        I hate to see Zandi lining up with the past thats in the Advisory positions of the White House today …. bad news for the Moodys guys … Conflicts of Interest all over the place here … http://dieoff.org/page43.htm

      • Pete Murphy says:

        Hungry, I was most struck by the following from your link:

        Professor John P. Holdren of the University of California has generated an “optimistic” scenario for solving the population-resource-environment predicament. This envisages population growth halted at 10 billion a century from now, and rich nations reducing their energy consumption to 3 kW a head. His population target is feasible with modest effort, and the reduction in energy consumption could be achieved with technologies already in hand—given the necessary political will—and would produce an increase in the quality of life. This would provide room for needed economic growth in poor nations, which could triple their per-person energy use to 3 kW. Thus the gap between rich and poor nations would be closed, while the total world impact would increase from 13 TW to 30 TW (10 billion x 3 kW).

        This is typical economist double-speak, that somehow growth in the population to 10 billion, forcing a more-than-50% decrease in per capita energy consumption in the developed world, results in “an increase in the quality of life.” Not even considered by Holdren is just what in the hell everyone will do for a living when everyone is consuming so much less. The stupidity on display is breath-taking.

  6. ClydeB says:

    “The stupidity on display is breath-taking”.

    No truer words were ever spoken.

    It seems to be the case that there is a total disconnect between logical thought and keyboard manipulation. I suspect that if the pundits were using pen and paper, slide rules and snail mail, the stuff they offer for consumption would be much different. Volume and immediacy appear to be the driving force to some of these pieces and the ‘cut and paste’ capability of electronic publishing fills the bill.

    What earthly force can effectively “halt the growth in population at 10 billion” at some later date? Were there some such mechanism, why not implement it now?
    The solutions you describe in Five Short Blasts are more logical than anything I read about anywhere else.

    We must all keep applying pressure where we can.

  7. Adam Surma says:

    Correct me if I’m wrong, but I feel as though most economist overly complicate things. I have always felt that a simplistic version of the economy can elaborate many of the problems we currently face. In early American society, families themselves would manufacture goods and trade them with other families. A women could become a skilled seamstress and produce clothing that was traded to say a farmer for food. Wealth increased and was directly dependent upon production of goods. Increased production leads to increased consumption, leads to increased wealth. Of course in this scenario you need to have two parties both capable of both producing goods that are valuable and be willing to trade. This ability to produce goods can equate to a means of payment to consume goods. In our current society, a huge issue at hand is that many of our wealthiest individuals have come from the financial sector. These individuals do not produce anything, they simply shift money around as investments and skim from the top. These individuals receive payments as though they are among the most productive members of society are in fact as we have seen destructive to the economy. This has created a high and unjust level of income inequality. The consumption power of the average American is directly affected by this high inequality. This sector has become attractive to our skilled/ educated, because money can be made relatively quick and easy, and it has caused great harm to our technological and productive sectors. Instead of having our talented becoming scientists and engineers creating more efficient processes we get Wall Street investors. Isolated wealth particularly and Large corporations specifically have spelled doom for our society. Large corporations simultaneously 1.) squash competition from small business because an individual domestic producer cannot compete with mega-industries that enjoy large savings of scale, along with the ability to outsource production to nations like china where they have an absolute advantage of cheap labor. 2.) Create a race to the bottom by treating “labor” as a cost of production which should be minimized. Labor is devalued in that a.) an individual cannot choose to work for themselves and thus must choose from what large company they wish to work for (wal-mart not hiring a needed worker is not fatal to its existence, but for an individual to not be working it can be catastrophic) Corporation can manipulate this because there is no meaningful competition of other firms hiring in the area. Furthermore like the financial industry, corporate board of directors frequently as favors elect one another to each companies boards, set salaries in the millions of dollars, despite meeting for less than 40 hours a year. Income thus aggrandizes in the hands of very few individuals. Competition with these wealthy individuals is impossible because as logic shows making a million when you have a million is far easier than making something out of nothing, The data supports this by showing the income of the top 1% increasing over 265% in the last 20 years vs. 24% gains for middle class and 12% for the lower classes. So what happens is the average person can produce something but at a higher cost that cannot compete, thus all consumption begins to go through large corporate governance, and while 1% may be able to make up for the reduce consumption under the of other groups under the bs rubic of GDP it does so imperfectly by replace high utility necessities with outrageous luxury items, that further leads to other issues that social inequalities create (i.e. higher rates of crime (increased incarceration rates) drug use, and government welfare) This Money is spent not on consumable goods, nor is money earned (goods traded to the poor for other goods produce. In effect corporate America has killed the golden goose. Now we must look at the true perversiveness of our economic system. Reduced job opportunities, and globalization has effectively driven down wages (along with artificially Intelligent Kapital that deskills workers, like the auto plant in Brazil that essentially runs itself) while marketing and manipulation of the human psyche has encouraged rampant consumerism in which people spent upward of 130% of their actual income. Spending above your rate of income, combined with decrease (wages/ production) has a catastrophic affect on future household consumption. Consumption must drop belowe 70% of prior levels to pay back debt and to accommodate for lower payments from work. This consumption results in smaller sales, results in further cutbacks, results in people out of work, with no other opportunity to produce goods, because they cannot compete with corporate low prices results in consumption dropping further and finally to a point were the corporations no longer have a consumer base. thus the wealthy then will see a reduction in their earnings without having somebody capable of buying its goods. All time great quote (auto worker and plant manager inspecting new assembly line. Manager says this assembly line can produce a hundred times the cars of one worker. Auto worker “Lets see that machine buy cars” In sum are current society has created a group with the vast majority of those things essential to consumption and production. Consumption 1% of the nation has the vast reserves of wealth, production: wealth owns kapital that substitutes out human workers, and have access to a group of essentially slave labor(china/ south east asia) Leading to unruly consumption, devalued labor, unemployment, prisons, and welfare. making a large portion of the population wholly unproductive and creating a system in which we produce to many luxuries, and to few necessities. Bring back the 90% plus estate tax, require are labor laws be at least matched by our trading partners, regulate marketing, banking, credit card companies, and corporate boards. Prosperity will be stable and secure with far less waste. A society based upon several thousands of businesses spreads/ reduces the risk of economic collapse in a way that a few hundred large corporations cannot, and it creates the market forces our economy now lacks

    • Pete Murphy says:

      Thanks for stopping by, Adam. I don’t agree that the financial industry lies at the root of our problems. There have always been people who grew fabulously wealthy in the banking industry. Today, the financial industry takes a lot of heat for the state of the economy because of its role in the whole sub-prime loan collapse fiasco. What most people fail to recognize is that the financial industry was intentionally let off its leash by the government, who encouraged lax lending standards as a means of attracting foreign trade dollars back into the economy. Foreigners, flush with U.S. trade deficit dollars, desperate for some place to “invest” them back in the U.S., turned to the purchase of securities consisting of repackaged sub-prime mortgages.

      The root cause, which you touched upon with your comments about trade, is the trade deficit. But the trade deficit isn’t driven by a race-to-the-bottom quest for cheap labor. If it was, then why is our trade deficit the worst (in per capita terms) with wealthy nations like Japan and Germany – far worse than the deficit with China? It’s because of the disparity in population density. Their extreme population densities make them incapable of consuming products at the same level as the U.S. But they’re every bit as productive. Free trade with such a nation virtually guarantees a trade deficit – not because we consume too much but because they consume too little.

      The only remedy for such a situation is a tariff structure indexed to population density with the aim of restoring a balance of trade in manufactured goods.

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