The Job Situation Is Bad, Even New York Times No Longer In Denial

You know it is bad when the New York Times finally seems to "get it" despite their history of just spinning the Obama PR--

Job Growth Is Sluggish, Raising Fear of Malaise - NYTimes.com: "Missing: nearly three million American workers. This isn’t the latest dystopian science fiction story or the pitch for a Hollywood thriller. It is the economic trend that has alarmed experts and policy makers alike. A growing number of people — many in their prime working years — have simply given up on landing a job. On Friday, the Labor Department reported that the overall unemployment rate dropped slightly to 6.1 percent in August. But that improvement was mostly a result of Americans dropping out of the labor force, not of their finding work. The situation helps explain why so many ordinary Americans remain doubtful about the recovery, now in its fifth year..."

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US in decline and denial, Texas moves ahead (slides)

Fs 140211 Slides source: http://www.scribd.com/doc/206656951/Fs-140211-Slides

       
I guess they are too arrogant in Washington to notice Texas is doing so much better than New York, California, Illinois, etc.--you know, the big "Democratic, Blue States." If Obama really wanted to help "working people" and increase jobs, he would sit at the feet of Texans and learn something about how the economy really works.

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Obamacare Has Negative Impact on Jobs

Two-thirds say less likely to add new employees due to Obamacare--

Mish's Global Economic Trend Analysis: Survey on Impact of Obamacare on Corporate Hiring; Businesses Far More Pessimistic vs. March: "Sageworks surveyed 300 accounting professionals who work closely with [privately held] firms and found that 66 percent expect the new health care changes will make it less likely that businesses will add new employees in the next year. Sixteen percent said it would have “no impact,” and 14 percent of respondents said they were “unsure” about the ultimate impact. Only 2 percent said the Act makes it “more likely” that businesses will add new employees. "

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Obamacare Strikes: Part-Time Jobs Surge To All Time High; Full-Time Jobs Plunge By 240,000

Obamacare Strikes: Part-Time Jobs Surge To All Time High; Full-Time Jobs Plunge By 240,000 | Zero Hedge: "As a reminder: jobs have quantity and quality components. The quantity component was good enough to convince the 10 Year the taper is imminent (if not stocks, which continue to trade dislocated from any and all fundamentals). But how about the quality? In a word: not good. In June, the household survey reported that part-time jobs soared by 360,000 to 28,059,000 - an all time record high. Full time jobs? Down 240,000.  And looking back at the entire year, so far in 2013, just 130K Full-Time Jobs have been added, offset by a whopping 557K Part-Time jobs. And there is your jobs "quality" leading to today's market euphoria (if only for now)." (read more at link above)

And the mainstream media calls this good news!

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IRS economic headwinds

You make it difficult to comply, or engage in administrative, bureaucratic harassment, guess what? They stop doing business with you, stop investing in your "domain," or avoid having anything to do with you. If Obama really wanted jobs--he could start by having his administration remove or reform regulations that are barriers to investment and more jobs--

RAHN: IRS troubles go global - Washington Times: "The Foreign Account Tax Compliance Act is already causing many foreign financial institutions to cease investing in the United States or accepting clients with any U.S. connection. Eventually, this regulation may cost the country trillions of dollars in lost foreign investment and millions of lost U.S. jobs. Yet the IRS and Treasury failed to do an independent and serious cost-benefit analysis of the regulation as required. Private-sector executives who fail to do such an analysis could be fired or fined for failing to carry out their fiduciary responsibility." (read more at link above)

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Employment--what's the problem

Poor President Obama--every day he looks weaker and ineffectual. You want to "create" jobs? More government is NOT the answer, in fact, it is a big part of the problem--

"As a Realtor, I speak with many business owners every day. Most are not hiring, waiting to see how the new healthcare law will affect their bottom lines. Growing government is not the answer. In Miami-Dade, we saw a population increase of about 10% between the year 2000 and 2010, yet our local taxes increased by almost 70%, which resulted in bloated payrolls, without any discernible betterment of services. Business people need a reliable framework to grow their businesses, uncertainty over more onerous government regulation and taxes have stifle and will continue stifle job growth, not only in Florida but elsewhere."--reader's comment in the Miami Herald

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Why the unemployment rate is misleading

Here's another take on why the headline unemployment rate peddled by Washington is misleading--

Why the unemployment rate is so misleading - Rex Nutting - MarketWatch: What’s the ‘real’ unemployment rate? . . . . If we really want to understand the health of the labor market, it’d be best to focus on employment and unemployment of the working-age population, 25 to 65, and leave millions of teenagers and octogenarians out of the equation. Unfortunately, this data isn’t published by the government in the monthly employment report, and it isn’t seasonally adjusted, so it’s harder to analyze. But it is available on the Bureau of Labor Statistics website. In 2012, the participation rate for the working-age population was 77.5%, down about three percentage points from the peak of 80.2% in 1997. Find the data yourself. . . .It means that the vast majority of working-age adults, men and women, are working or looking for work. But it also means that many millions have given up hope of finding a job. Some of them will never work again. If the participation rate were where it was in 2007, about 3 million more working-age adults (age 25-65) would be in the labor force, and the unemployment rate for that group would be about 9%, instead of 6.8%. . . .

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The Obama Legacy so far, is a Nightmare

Here's a snapshot of the Obama record thus far--

In The Last 5 Years --

• The Civilian Institutional Population Rose 9.9 Million
• The Labor Force Rose Only .9 Million (yes, less than 1 million)
• Those Not in the Labor Force Rose 9.8 Million
• Employment Fell by 2.3 Million
• Full-Time Employment Fell by 5.3 Million
• Part-Time Employment Rose by .9 Million 
• Unemployment Rose by 4.5 Million
• Food Stamp Usage Rose by 20.3 Million

Source: Mish's Global Economic Trend Analysis: Demographic Nightmare; Recession Through Recovery in Pictures 

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Pronouncements, Predictions, and Projections

From Krugman comes this bite-size insight into what the future holds (as far as jobs) and it's not very positive--

"Along with its new policy pronouncement, the Fed released its economic projections (pdf). What struck me is that the Fed expects the unemployment rate to be well above its long-run level even in the fourth quarter of 2015, which is as far as its projections go.This means that the Fed is projecting elevated unemployment nine full years after the Great Recession started. And, of course, the Fed has been consistently over-optimistic."

Welcome to the New Normal!

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Declining Jobless rate due to shrinking labor force not good news

The spinners in the media have been rejoicing over a declining unemployment rate (even the small decline reported over the last few months). Unfortunately, a decreasing unemployment rate is not necessarily good news. After all, if everyone dropped out of the work force, the unemployment rate would be zero (-0-)! A decreasing unemployment rate is not good news when it reflects a shrinking labor force--

Jobless rate 7.7%; 146,000 new jobs: "The government revised down job gains for September and October by a total 49,000. September's additions were revised from 148,000 to 132,000 and October's, from 171,000 to 138,000. . . . Meanwhile, the continuing sharp drop in the unemployment rate -- from 8.3% to 7.7% since July -- is surprising and at least partly reflects retiring Baby Boomers, says Chief U.S. Economist Jim O'Sullivan of High Frequency Economics. "What's happening here is the demographics have changed," he says. He says monthly job gains of about 75,000 are likely enough to keep the jobless rate from rising, down from 100,000 to 150,000. A shrinking labor force, however, does not bode well for economic growth because retirees have less spending power."

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Where Are The Jobs?

Where are the jobs? Forget about the "unemployment rate" and instead look at the employment-population ratio--

Paul Krugman in the New York Times explains:
" . . . the unemployment rate is a problematic measure, because it can fall not because more people are working but simply because fewer people are looking for work. . . An alternative is therefore to count employment rather than unemployment; one simple measure is the employment-population ratio, which suggests no improvement for years:

Info source: St. Louis Fed and Paul Krugman/NYTimes.com

In other words, there has been no improvement in actual "employment" since we hit bottom in 2009!

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The True Jobs Report (not so good)

You want a true picture of the job situation in the U.S.? At the rate of job growth for the past 18 months of the Obama administration, the U.S. economy will not get back to full employment until 2025!

Kudos to Ezra Klein of the Washington Post for "shining light" on the "jobs report" issued by Washington:

Wait, the U.S. economy actually lost 1.2 million jobs in July?: "The U.S. economy lost 1.2 million jobs between June and July. But that’s not how it got reported. When the Bureau of Labor Statistics (BLS) released its jobs figures for July, it said the economy gained 163,000 jobs. So what gives? BLS isn’t hiding anything. The discrepancy just has to do with what’s known as “seasonal adjustments.” The U.S. economy follows certain predictable patterns in hiring and layoffs every year. School districts always let workers go for the summer and hire in the fall. Retailers always staff up for the Christmas holidays and lay people off afterwards. Students always flood the labor market in June. So if we want to know how well the economy is doing, we want to know how many jobs were added after taking these predictable fluctuations into account. This is exactly what BLS does in its monthly jobs reports. As Jacob Goldstein of Planet Money points out, the U.S. economy had 1.2 million fewer jobs (pdf) in July than it did in June. But, according to the bureau, the economy still had 163,000 more jobs than one would’ve expected, given seasonal trends. That’s a sign of a steadily recovering labor market. So BLS reported it as a 163,000 gain in jobs. In theory, that makes sense. But some economists and analysts now wonder if the BLS seasonal adjustments are somehow off a bit. If the financial crisis and recession mucked with the seasonal ebb and flow of the economy, then the adjustments that BLS makes for its monthly reports might be a bit skewed. Some jobs reports might look much better than they actually are. And others might look worse. There’s some reason to suspect this is happening. . . . So look at the long-term trends. For the past one-and-a-half years, the U.S. economy has added about 152,000 jobs per month on average. It’s a decent, but certainly not terrific jobs recovery: According to the Hamilton Project’s jobs calculator, the U.S. economy won’t get back to full employment until 2025 at this pace. . . it’s probably more accurate to watch that long-run average than to fixate on any one monthly jobs report."

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The economy? Slippin' and Slidin'

The U.S. economy? Slippin' and slidin'--it's all in the jobs report (both excerpts below are from Ezra Klein of the Washington Post):

Early Friday morning (before jobs report released):
Previewing the June jobs report: 100,000 jobs? 125,000?: "The big news today will be the jobs report, which comes out at 8:30am. Economists surveyed by Bloomberg News expect to learn that the economy added 100,000 jobs in June — well above the 69,000 it added in May, but well below the 259,000 it added in February. Goldman Sachs, which is expecting to see that we added 125,000 jobs in June, points out that this will be the first jobs report in awhile that “should be relatively free of the distortions that have plagued analysis of the underlying employment trend recently. In particular, the ‘payback’ for the unusually mild winter is now almost certainly behind us.” That is to say, the June jobs report might be a clearer look at the underlying trends in the economy than either the quick, weather-aided growth we saw early in the year or the sharp deceleration we saw in May. Hopefully, it won’t be too depressing."

Later Friday--after the jobs report released:
The June jobs report in one word: ‘unchanged’: "In this economy, little or no change isn’t good enough. We added 80,000 jobs in June. That’s not enough to keep up with population growth. So, in the context of our growing workforce, the labor market lost ground last month."

So forget all the "spin"--bottom line: the job situation got worse last month. The economy? Just slippin' and slidin'.

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"More Government" is NOT the "Answer"

You think "more government" will solve the U.S. unemployment problem? Look at France--

Why France Has So Many 49-Employee Companies - Businessweek: ". . . Once a company has at least 50 employees inside France, management must create three worker councils, introduce profit sharing, and submit restructuring plans to the councils if the company decides to fire workers for economic reasons. French businesspeople often skirt these restraints by creating new companies rather than expanding existing ones. “I can’t tell you how many times when I was Minister I’d meet an entrepreneur who would tell me about his companies,” Thierry Breton, chief executive officer of consulting firm Atos and Minister of Finance from 2005 to 2007, said at a Paris conference on April 4. “I’d ask, ‘Why companies?’ He’d say, ‘Oh, I have several so that I can keep [the workforce] under 50.’ We have to review our labor code. . . . Companies say the biggest obstacle to hiring is the 102-year-old Code du Travail, a 3,200-page rule book that dictates everything from job classifications to the ability to fire workers. Many of these rules kick in after a company’s French payroll creeps beyond 49. . . . There are now 2.9 million people out of work in France, almost 10 percent of the workforce and the most in 12 years. . . . "

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Obama's Problem In A Nutshell

It's not often I come across an article with great insight, and yet is succinct-- I excerpt such an article below by Debra Saunders. It explains what Obama's problem really is and unfortunately, for him and the Democrats, the problem is systemic--not just policy and politics--but his entire worldview:

RealClearPolitics - Obama Thinks He's the Fairness Czar: "Cory Booker, mayor of Newark, N.J., came across as a moderate, sensible Democrat when he said on "Meet the Press" Sunday that negative political ads are "nauseating to the American public. . . . Booker, a Barack Obama surrogate, later tried to walk back his comments. . . . But there is no walking back from Booker's disapproval of the Obama campaign's attacks on Bain Capital . . . In the ad, laid-off steelworkers had some choice words for Romney. Like "vampire" and "job destroyer." The problem with such ads, Booker said Sunday, is that "we're getting to a ridiculous point in America." Pension funds, unions and others invest in companies like Bain Capital. Bain's record has been to grow businesses. To Booker, Bain Capital has been good for America. To Obamaland, Bain Capital has been bad for America. As a mayor, Booker said, he, too, has had to lay off workers "because it's the only way" his "government would survive." He added, "Call me a job cutter if you want." . . . Monday, a reporter asked Obama about Booker's remarks and the role of private equity. The president explained that the goal of private investment is to "maximize profits," whereas a president's job is to make sure that everyone has "a fair shot" and that everyone pays his or her "fair share" of taxes. That's the problem with Obama; he thinks he's the fairness czar. He didn't say that a president is supposed to create an environment that nurtures business success. . . . Obama's war is a war on private money. He thinks his job is to create job training programs, not create an environment that creates real jobs." 

The FOCUS (whether Obama knows it or not) needs to be on economic "growth" not "jobs"--real jobs in the non-government sector are the RESULT of GROWTH. This is what Obama doesn't get. Anyone in government can just create "government jobs" by spending money (of course government today has already spent all its money, hence deficit spending).  To create REAL JOBS--jobs sustainable in the private economy--government can only create an "environment" which encourages growth. Unfortunately, Obama hasn't a clue how to do that.

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Hey, you're not unemployed, you're "not in Labor Force"

"Not in Labor Force" now "off the chart"

CNBC: "Economists polled by Reuters had expected nonfarm employment to increase 203,000 and the unemployment rate to hold at 8.3 percent."

Instead, "U.S. payrolls rose far less than expected in March (Employers added 120,000 jobs last month, the Labor Department said on Friday, the smallest increase since October)" and yet "the unemployment rate fell to a three-year low of 8.2 percent." (source: CNBC).

How could the economy add fewer jobs than expected, and yet the unemployment rate drop? That's easy, those classified "not in labor force" increased to an "all time high."

NFP Big Miss: 120K, Expectations 205K, Unemployment 8.2%, "Not In Labor Force" At New All Time High | ZeroHedge: "The unemployment rate drops to 8.2% for one simple reason: the number of people not in the labor force is back to all time high: 87,897,000."

This is how Obama is getting the unemployment rate to decline:

Now, if we could only get everyone to "drop out of the Labor Force," our unemployment rate would be 0% and all of our problems solved--right?

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The "Obama Fudge Jobs Report"

As a follow-up to my "Washington Fudge" post on the "January Jobs Report" (they're "fudging" the numbers):

Santelli on the "shrinkage"

Record 1.2 Million People Fall Out Of Labor Force In One Month, Labor Force Participation Rate Tumbles To Fresh 30 Year Low | ZeroHedge: "Submitted by Tyler Durden on 02/03/2012 08:51 -0500: A month ago, we joked when we said that for Obama to get the unemployment rate to negative by election time, all he has to do is to crush the labor force participation rate to about 55%. Looks like the good folks at the BLS heard us: it appears that the people not in the labor force exploded by an unprecedented record 1.2 million."

If you want the truth about the "Obama Fudge Jobs Report," look at the charts posted at Zero Hedge or here or read this.

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January jobs report--"Washington Fudge"

You think the January jobs report is good news? You better think again--they're "fudging" the numbers in Washington--no surprise since this is an election year.  My source? How about Floyd Norris in the New York Times--

Wow. But Is the Number Real? - NYTimes.com: "How many jobs did the American economy add in January?

The Labor Department estimated on Friday that the economy gained 243,000 jobs.

The department also estimated that the economy lost 2,689,000 jobs in the month.

The difference in the two numbers is in seasonal adjustment. Employment always falls in January, as temporary Christmas jobs end. So the government applies seasonal adjustment factors in an effort to discern the real trend of the economy apart from seasonal fluctuations. The actual survey showed the big loss in jobs. The seasonal adjustments produced the reported gain of 243,000 jobs.

A reason to doubt the number is that there has been a tendency in this cycle for the seasonal factors to overstate moves, in both directions. Labor mobility is down, as fewer workers quit to seek better jobs and employers both hire and fire fewer people than they used to do. If the seasonal adjustment was too large, then the gain should be smaller."

In other words, the economy lost jobs last month. But the Obama administration creates a "positive report" by using unreliable "seasonal adjustment factors." Well, at least Floyd Norris in the New York Times isn't fooled. How about you?

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