Summer Stall & Zero-Sum Game(Wall Street Journal)

Summer Stall & Zero-Sum Game(Wall Street Journal)

Unemployment Rate ProjectionsSurvey of Economists (Wall Street Journal)

Unemployment Rate ProjectionsSurvey of Economists (Wall Street Journal)

Projections & Sector Comparison

Source: Wall Street JournalPlease note: WSJ Projections were released prior to the BLS report

GDP Projections Survey of Economists (Wall Street Journal)

GDP Projections Survey of Economists (Wall Street Journal)

2nd Quarter GDP: 1% (2nd Estimate)2nd Quarter GDP: 1% (2nd Estimate)

Items to Note & GDP

Sources: CNBC, Wall Street Journal, Bureau of Economic Analysis, Bureau of Labor Statistics (BLS)

Economic Items to Note:Economic Items to Note:

Decreasing Working Population & Government Employment

  2010 2011 Components of 

GDP 1st 2nd 3rd 4th  1st 2nd

Consumers   

1.92% 2.05% 1.85% 2.48% 1.47% 0.30%(Personal Consumption)

*Businesses  

3.25% 2.92% 1.14% -0.91% 0.47% 0.78%

(Gross Private Domestic Investment)Net Exports                   (Exports-Imports) -0.97% -1.94% -0.68% 1.37% -0.34% 0.09%

Government  -0.26% 0.77% 0.20% -0.58 -1.23% -0.18%Total GDP 3.94% 3.80% 2.51% 2.36% 0.37% 0.99%

           

*Inventories  

3.10% 0.79% 0.86% -1.79% 0.32% -0.23%component of Business

“The employment-to-population ratio stood at just 58.2% in August, according to the Labor Department, a hair above the 28-year low it fell to in July. That is down from 62.7% in December 2007, when the last recession started, and below the all-time high of 64.7% it reached in 2000.”

“It isn't unusual for the ratio to decline during a recession, since that is when it is harder to find work. What is unusual is for it to go lower through a recovery, as it has for the past two years.”

“The decline in the share of adults who are working reflects a shift in demographics that would have reduced the ratio even if there had been no recession. Nearly a full percentage point of the decline in the ratio appears to be the result of a surge of retirements by baby boomers.”

"Many people say the best measure of employment is the employment-to-population ratio, but that's giving a distorted view if you don't take account of the demographics," said economist Dean Maki of Barclays Capital. "It would be inappropriate to expect the unemployment-to-population ratio to return to its prerecession levels.“

Since the recession started, there has also been a jump in the number of people applying for, and receiving, long-term disability benefits. History suggests that once people go on long-term disability, they rarely re-enter the job market.

But while demographics and other factors suggest that the share of the population working won't rebound to prerecession levels—and that the jobs hole implied by the employment-to-population ratio is overstated— that still isn't great news. When fewer people are working, the economy can't grow as quickly, and prosperity declines. Wall Street Journal – Low Share of Adults Working

Government employment continued to trend down over the month (-17,000). Despite the return ofabout 22,000 workers from a partial government shutdown in Minnesota, employment in stategovernment changed little in August (+5,000). Employment in local government continued to decline.Since employment peaked in September 2008, local government has lost 550,000 jobs. BLS

• Job Revisions: 58,000 in negative revisions (for last two months – mostly government

jobs)

• Information Sector: Down 48,000 jobs (which includes 45,000 Striking Verizon Workers).

• State/Local Government: Minnesota Government Workers returned to work

(impact: 22,000 jobs)

Number of people employed as a temporary employee divided by total non farm payroll employment

June 2009 Recession Officially EndedJuly 2009 Temp Penetration Trend Turns PositiveOct 2009 1st Job Growth >100,000 (Household Survey)Nov 2009 1st Job Growth (Payroll Survey)

Temp EmploymentTemporary help services gained 4,700 jobs.

Why is the Temp Penetration Rate Important?“Temporary Help Employment is a Leading Indicator for Nonfarm Employment—Staffing job trends lead nonfarm employment by three months when the economy is emerging from a recession and by six months during periods of normal economic growth.” American Staffing Association

US Employment Situation

Temp Penetration Rate: 1.71% -.01%

Temp Penetration Rate: 1.71% -.01%

Job Loss/Gain: + 17,000 Jobs Job Loss/Gain: + 17,000 Jobs

Unemployment Rate: 9.1% unchanged Unemployment Rate: 9.1% unchanged

I

Unemployment Rate: Bachelor’s Degree or higher

April May June July August4.5% 4.5% 4.4% 4.3% 4.3%

Source: Bureau of Labor Statistics, American Staffing Association

Nonfarm Payroll – Job Growth Details Jobs Added/LostPrivate Sector 17,000Government Sector -17,000Total 0

Job Gains Change from

Previous Month

Professional & Business Services 28,000Financial Activities 3,000Leisure & Hospitality 2,000Education & Health Services 34,000 - Education -1,600 - Healthcare 29,700 - Social Assistance 5,800

Job Loses Change from

Previous Month

Government -17,000

Retail Trade -7,800

Construction -5,000

Manufacturing -3,000