Jobless Rate Lowest in Four Years

December 7, 2012 9:10 am

by Ed · 19 comments

The hiring rate exceeded expectations in November.

Modest hiring continued in November and the unemployment rate fell to its lowest level in nearly four years, according to a report released Friday.

The U.S. economy added 146,000 jobs in November, and the unemployment rate fell to 7.7% from 7.9% in October, the Labor Department said. That’s the lowest unemployment rate since December 2008.

By linking to a CNN report, I’m keeping it Georgia-centric. Sort of.

Discuss. Update from Mike Hassinger: Please discuss in the context of ratios, using the chart below:

Ed is Amazing December 7, 2012 at 10:14 am

FYI Mike, neither I nor the MSM has implied that the jobs outlook is particularly good.

Mike Hassinger December 7, 2012 at 10:29 am

Really? So all the headlines about the “jobless rate dropping,” and the “economy adding 146,000 new jobs” must mean something other than what I think they mean, then.

Ed is Amazing December 7, 2012 at 10:40 am

So like, they are just supposed to ignore the numbers is what you’re saying?

Got it.

SallyForth December 7, 2012 at 2:45 pm

Could we just go back to plain ol’ Ed? This new handle carries extremely high expectations.

Ed is Amazing December 7, 2012 at 10:42 am

Ok, here is more breathlessly positive coverage, all from the link.

Overall, the U.S. labor market has still not completely recovered from the financial crisis. Of the 8.8 million jobs lost, about 4.2 million have still not been added back.

Economists often say that job growth around 150,000 a month is enough to keep up with population growth, but not much more.

“At this rate of job growth, it will take us more than 10 years to get back to the pre-recession unemployment rate,” said Heidi Shierholz, an economist for the liberal Economic Policy Institute. “The November data provide a clear reminder that mass joblessness remains the real and present economic danger this country faces.”

You’re right, Mike! MSM sure is out to paint a rosy picture!

Mike Hassinger December 7, 2012 at 10:50 am

Don’t be such an idiot. Go read what you posted, especially the part about “lowest unemployment rate since December 2008.” The very next line is: “…it fell due mainly to workers dropping out of the labor force.”
I’m not accusing you of deliberately trying to paint a rosy scenario because you are a communist sympathizer and propagandist, I’m ALSO making sure that we include some context.
:)

Ed is Amazing December 7, 2012 at 11:11 am

OK, well here’s more context…. from the MSM.

The gain in November was sharper than expected in the aftermath of Hurricane Sandy, but the Labor Department also revised downward previous gains for September and October.

Look, the jobs picture is overall bad but its not as bad as GOP partisans want to make it. That’s kind of the gist of the report, and what the MSM is saying (well, not explicitly about the partisans but they are saying it isn’t good.)

Harry December 7, 2012 at 11:17 am
Bill Dawers December 7, 2012 at 11:21 am

Looking at the employment to population ratio in isolation is really problematic.

We have an aging population with increasing numbers of elderly and retirees, a large number of college students, lots of stay-at-home parents, etc.

According to the latest data (all here: http://bls.gov/news.release/pdf/empsit.pdf), the labor force participation rate for noninstitutionalized, not-disabled persons over 16 (including retirees and elderly) is 69.2%. For men aged 16-64, the labor force participation rate is 82.3% with a 7.3% unemployment rate.

Among Americans over 25 with a bachelor’s degree or higher (including retirees), the participation rate is 75.5% and the unemployment rate is 3.7%. Among those who didn’t finish high school, the participation rate is 45.2% and the unemployment rate is 11.8%.

We’re in a very slow recovery from the recession, similar to the slow recovery from the 2001 recession. Of course that 2001 recession was much shallower so the recovery didn’t feel nearly as weak.

Today’s report was certainly skewed somehow by Hurricane Sandy. I had thought along with most others that it would be much worse than this because of the storm, so it will be interesting to see additional data for individual states. I’ve got a few details and charts about today’s release on my blog: http://www.billdawers.com/2012/12/07/u-s-economy-added-146000-jobs-in-november-unemployment-rate-drops-to-7-7/

Harry December 7, 2012 at 11:28 am

So there was a drop in the labor force participation rate which declined by 0.2% to 63.6% once again, as the number of people out of the labor increased by over 540K to 88,883,000?

Bill Dawers December 7, 2012 at 11:36 am

These are estimates. The labor force participation rate will likely rebound slightly as the economy picks up and more potential workers come off the sidelines — and as more students forego college or grad school. But the labor force participation rate is on a long downward trend because of the aging of the population.

I’m guessing that rather than impacting the unemployment rate itself as expected, Hurricane Sandy might have actually impacted the labor force participation rate as some out of work people gave up looking for a while (the survey was conducted in the first full week of November). But that’s just a guess.

Zero Hedge is entertaining , but for a sober discussion of the labor force participation rate and the long-term trends, try Calculated Risk: http://www.calculatedriskblog.com/2012/11/update-further-discussion-on-labor.html

Bill Dawers December 7, 2012 at 1:16 pm

Calculated Risk has up a more in-depth post that includes a graph of the employment to population ratio of 25-54 year olds: http://www.calculatedriskblog.com/2012/12/employment-report-more-positives-than.html

View from Brookhaven December 7, 2012 at 11:35 am

Personally shocked that the participation rate didn’t decline much more sharply…y’know, with all the good Republicans “shrugging” and moving in to their underground bunkers full of guns and baked beans following the Obama re-election.

Obama must be cooking the numbers again.

Harry December 7, 2012 at 11:37 am

I’m sure not motivated to hire anybody.

atlanta_advocate December 7, 2012 at 12:16 pm

I don’t know why this is such a political football. The economy has been adding jobs for over a year now, going on 2, and also the number of jobs added per month has been slowly increasing, from about 50,000 a month to consistently over 100,000 a month. (Lest we forget, the Romney campaign acknowledged as much when they shifted their attack line over the economy from the unemployment rate in general to the unemployment rate being higher now than it was when Obama was elected.) Yes, the labor force participation rate is lower, but it is possible for the labor force participation rate to be lower and the economy to add jobs simultaneously. While the two are related, it is not a linear, direct relation. Instead, it takes a sustained period of heavy job growth – heavier than we have had at any point in the Obama administration – for the labor force participation rate to pick up. So we are adding jobs, just not fast enough, not in enough sectors, and not in enough areas of the country.

But we are adding jobs fast and consistently enough to make certain people believe that the economy has turned the corner. And those certain people include not only Christmas shoppers – the early results are mostly positive – but team Obama, which is much less likely to fold on the fiscal cliff negotiations because the numbers may lead them to believe that the economy can handle the tax increases and spending cuts. Their position last year this time – before over a year of small but still consistently improving jobs growth numbers – was otherwise, and they said so.

saltycracker December 7, 2012 at 3:17 pm

There is no way of really determining the rapid growth of fraud in the jobs. Certainly there are some good folks out of a job but in my daily experiences including bar (the drinking one) conversations:

A. Working for cash
B. Working for cash & collecting unemployment
C. Got a third party working with a Doc & attorney to get SSD
D. Reporting sales but skimming the cash
E. Not reporting cash sales
F. Don’t like the job offers
G. Unqualified to do the work
H. Not willing to change industries or training
I. Deserve a little personal time
J. Going to stay in this home until evicted – it’s been 2 years now – this from an employed flight attendant & state worker…..
K. Under 50 and see no reason to pay for health insurance

The list goes on and on and the rarest is the real deal but the above could be an unusual view or a lot of folks lie. It is an industry serving these folks – check the TV ads.

:) A lady was telling another lady that she loved Obama because she is unemployed and will now be able to get free health insurance. When asked why she was unemployed she said, “my company cut back because they couldn’t afford Obamacare.” (just kidding on this one)

seenbetrdayz December 7, 2012 at 4:02 pm

Are you sure you were just kidding? I do know some employers that are slashing worker hours to avoid having to pay for Obenefits. I wonder if one possible cause for increase in employment is that it is more feasible to hire a few part-time workers than one full time worker and not have to cover them under Obamacare.

http://times247.com/articles/employers-slash-hours-over-obamacare-costs

So, I guess the lesson is,

If you want to fix unemployment, then just have everyone work a few hours a week, instead of having a few people work many hours a week. Gone are the 40-hour workweeks?

saltycracker December 7, 2012 at 4:33 pm

To fix the bear problem, close the dump and attend to the abandoned/abused cubs, the aged and those tested as sick.

Cut benefits for those obese and sniffing smoke.

Feeding them makes them dependent and dangerous.

atlanta_advocate December 7, 2012 at 4:35 pm

Yep. ObamaCare is a mess. Which makes the failure of the GOP to offer an alternative from 1994-2008 (during which time they ran Congress, the White House, and for a great chunk of that period both) even more of a tragedy. All of the great GOP health care ideas that were only proposed when ObamaCare was put on the table never saw the light of day back then, even though the problem still existed, the GOP had the numbers and political capital to enact them, and there was a much better economic climate for doing so as well. Gee, wonder why that was?

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