September 2010 Unemployment Report: Still Weak

/ Jim Luke

From Calculated Risk (and the BLS):

From the BLS:

Nonfarm payroll employment edged down (-95,000) in September, and the unemployment rate was unchanged at 9.6 percent, the U.S. Bureau of Labor Statistics reported today. Government employment declined (-159,000), reflecting both a drop in the number of temporary jobs for Census 2010 and job losses in local government. Private-sector payroll employment continued to trend up modestly (+64,000).

Census 2010 hiring decreased 77,000 in September. Non-farm payroll employment decreased 18,000 in September ex-Census.

Both July and August payroll employment were revised down. The change in total nonfarm payroll employment for July was revised from -54,000 to -66,000, and the change for August was revised from -54,000 to -57,000….

Nonfarm payrolls decreased by 95 thousand in August. The economy has gained 334 thousand jobs over the last year, and lost 7.75 million jobs since the recession started in December 2007.

Percent Job Losses During RecessionsThe second graph shows the job losses from the start of the employment recession, in percentage terms (as opposed to the number of jobs lost).

The dotted line is ex-Census hiring. The two lines have joined since the decennial Census is almost over.

For the current employment recession, employment peaked in December 2007, and this recession is by far the worst recession since WWII in percentage terms, and 2nd worst in terms of the unemployment rate (only early ’80s recession with a peak of 10.8 percent was worse).

This is not very good news at all.  The “recovery” has been very slow and now it continues to slowdown, not accelerate as we need.  At present, we are in danger of “double-dipping” into recession again, largely because the federal stimulus is being withdrawn, private investment spending is nearly non-existent, and monetary policy has reached very severe limits at zero interest rates.  Even if the GDP growth did not slow down in 3rd quarter (I think it did) and continued to grow at the 1.6-1.7% annual real growth rate of the 2nd quarter, we won’t get back to full employment until nearly 2020, if at all.