Daily Archives: August 3, 2012
The following statistics were released today on the state of the US economy:
The ISM Non-Manufacturing Index rose 0.5 to 52.6. New orders rose 1 point to 54.3, while business activity, jumped 5.5 points to 57.2.
A net 163,000 new jobs were added to the economy in July, while the unemployment rate rose to 8.3%. This marks the 41st consecutive month that unemployment has remained above 8%. The broadest measure of unemployment measured by the BLS, the U-6 unemployment rate, rose to 15.2%. The average workweek remained unchanged at 34.5 hours, while hourly earnings increased by only 0.1%, rising 2 cents to $23.52. The civilian non-institutional adult population rose by 199,000 persons in July, while 195,000 fewer people were listed as being employed. As a result, the employment-population ratio fell back to its historical low of 58.4%, and the labor force participation rate fell to 63.7%, also a historical low. Prior to the current recession, the last time those ratios were this low was in 1983. If the labor force participation rate were at the historical average of 66.2%, the current rate of unemployment would be 11.72%. Overall, the report was merely "fairly bad", rather than "completely disastrous", like the last two months have been.
Interesting, isn’t it? I really don’t have to put anything else up there to explain that number. Everyone in their brother will look at it and understand that the unemployment rate just rose from 8.2% to 8.3%. Its sort of like celebrities who are identifiable by only their first name. However, Obama and the Democrats certainly don’t want to grant that number that sort of status.
The U.S. economy closed out an otherwise weak second quarter by creating more jobs than expected, with 163,000 new positions added, but the unemployment rate rose to 8.3 percent.
Of course the job creation rate isn’t even at the break even point, even if up slightly.
But that doesn’t mean there aren’t those out there spinning the results:
"While the monthly gain is still relatively small by historical standards, it might help spark somewhat higher consumer optimism and spending," Kathy Bostjancic, director of macroeconomic analysis at The Conference Board, said in response to the report.
Yeah, “spark.” Like all the other “sparks” we’ve been told about. Like the 3 “recovery summers” we’ve been promised. Like the job saves/creation the stimulus was going to provide (Remember we’re supposed to be at around 5% unemployment right now. That’s what Obama promised if we gave him a trillion dollars to throw down the sewer. He claimed that without it unemployment would rise to … oh, wait, over 8%). And this month we’ve seen the official unemployment rate go a tenth higher.
As for the spin, let’s get real instead:
Despite the seemingly good news, the report’s household showed that the actual amount of Americans working dropped by 195,000, with the net job gain resulting primarily from seasonal adjustments in the establishment survey. The birth-death model, which approximates net job growth from newly added or closed businesses, added 52,000 to the total.
The household survey also showed 150,000 fewer Americans in the workforce.
Perking right along, aren’t we? Oh, and by the way:
June’s anemic 80,000 gain was revised down to just 64,000.
And does the 8.3% number really reflect the problem? Well, we’ve said for years that it understates it. And it does:
While the figures themselves have been gloomy enough, there is considerable debate over whether the Labor Department’s headline numbers present the true picture.
A measure that takes into account those who have stopped looking for jobs as well as those working part-time for economic reasons has hovered near 15 percent. The so-called "real" unemployment rate, or U-6 measure, is above 20 percent in Nevada and California.
On a national level, that more encompassing rate edged higher to 15.0 percent.
But if you listen to Obama he’ll tell you that what he’s done “worked”. Then he’ll try to convince you it would be much worse if it hadn’t “worked”. Really?
If you honestly believe that, then you have a convenient memory that has obviously forgotten all the promises made about the stimulus spending.
None of what he and his administration has done has worked, we’re in horrible economic shape, he’s had 3 plus years to do something that would help the situation (just one example is the oil and gas industry where approving Keystone and opening federal lands and the offshore to exploration would have crated thousands of jobs), and he’s failed.
Time to give someone else a shot.
And yes, it’s that simple.
UPDATE: Zero Hedge chimes in – basically the numbers aren’t as good as they’re being spun:
We got the pre-spun job quantity data already, where we learned that nearly 3 times the headline print was due to seasonal and B/D adjustments and is thus nothing but noise. Now we get the quality. As can be seen below, courtesy of Table A9 from the Household Survey, in July the number of part-time jobs added was 31K, bringing the total to 27,925, just shy of the all time record of 28,038. Full time jobs? Down 228,000 to 114,345, lower than the February full-time jobs print of 114,408. Once again, more and more Americans are relinquishing any and all benefits associated with Full Time Jobs benefits, and instead are agreeing on a job. Any job. Even if it means working just 1 hour a week. For the BLS it doesn’t matter – 1 hour of work a week still qualifies you as a Part-Time worker.
UPDATE II: Meanwhile at the White House, unicorns and moon ponies continue to prance. Alan Kreuger:
While there is more work that remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression.
UPDATE III: In case you need a reminder of “The Promise and The Reality”:
Breitbart’s Mike Flynn reports:
President Barack Obama, along with many Democrats, likes to say that, while they may disagree with the GOP on many issues related to national security, they absolutely share their admiration and dedication to members of our armed forces. Obama, in particular, enjoys being seen visiting troops and having photos taken with members of our military. So, why is his campaign and the Democrat party suing to restrict their ability to vote in the upcoming election?
On July 17th, the Obama for America Campaign, the Democratic National Committee, and the Ohio Democratic Party filed suit in OH to strike down part of that state’s law governing voting by members of the military. Their suit said that part of the law is "arbitrary" with "no discernible rational basis."
Currently, Ohio allows the public to vote early in-person up until the Friday before the election. Members of the military are given three extra days to do so. While the Democrats may see this as "arbitrary" and having "no discernible rational basis," I think it is entirely reasonable given the demands on servicemen and women’s time and their obligations to their sworn duty.
Flynn cites the National Defense Committee which reports:
[f]or each of the last three years, the Department of Defense’s Federal Voting Assistance Program has reported to the President and the Congress that the number one reason for military voter disenfranchisement is inadequate time to successfully vote.
So here is a law actually trying to provide a little extra time to address the problem cited (btw, the members of the military would most likely have to show their military picture ID to be granted the opportunity to vote during that “extra time”). Why the resistance from the Obama campaign and Democrats? Why the intent to disenfranchise military voters?
If the polls are to be believed concerning how the military is likely to vote, it wouldn’t favor Obama or the Democrats. And, of course, Ohio is a swing state. So they want no extra time allowed for the military to vote (and don’t expect the DoJ to jump in here and take the side of the military either).
But hey, the military is still useful as props during photo ops and when they help burnish the C-i-C’s rep by killing bad guys like Osama. Voting? Yeah, not so much.