Here are the job market and compensation numbers for April 2008 (based on the job report):
Net loss of 49,000 jobs in the month (revised to loss of 62,000 jobs)
- April modified to a loss of 28,000 jobs (was estimated as a loss of 20,000)
- Analysts expected a loss of of either 58,000 or 60,000
- Five straight months of job losses
- For 2008, 324,000 jobs have been cut, an average of 65,000 a month
- The private sector has cut 411,000 jobs over 6 months (68,500 average)
- The number of people in the workforce increased by 577,000
- It was 173,000 in April
- College students
Unemployment rate rocketed up to 5.5%
- Biggest monthly jump in 22 years
- It is the highest its been in 3 1/2 years
- Forecasters thought the rise would be to 5.1%
- Some analysts believe this number will be revised down because of the flood of college students entering the workforce
- Taking presumptive teenagers out of the mix the unemployment still rises from 4.5% to 4.8%
- This number was 4.0% a year ago
- Long term unemployed increased from 17.8% to 18.3% in May
- Paul Ashworth said. “The economy has little forward momentum, employment is shrinking and the unemployment rate could reach 6 percent by the end of the year.”
Specific Segment Job numbers:
- Construction lost 34,000 jobs
- Retail lost 27,000
- Professional and Business Services lost 39,000
- Manufacturing lost 26,000 jobs (46,000 jobs lost in April – good sign?)
- Healthcare added 34,000
- Education and Health Services added 54,000 jobs
- Temp workers loss 30,000 jobs
- 150,000 lost over the year
- Considered a bellwether for the economy because these jobs go first
- Public sector added 17,000 jobs
Correlations:
- The surge of college students created a lot of distortion on the unemployment percentage. This can be revised next month or maybe evened out in September (although no vacuum was mentioned this past September)
- The birth/death model is fluctuating to a negative
- Spending on fuel as a share of wage income rose above 6%. That exceeds the percentage seen during the 1974-75 and 1990-91 oil-price shocks and approaches the 7% to 8% seen during the 1980-81 price surge
Notes:
- Paul Ashworth, senior US. economist with London-based Capital Economics, noted that the pace at which jobs were being lost has actually slowed
- In the first three months this year, job losses averaged about 83,000 monthly, but in April and May, the pace slowed to 38,500
- Although employers have cut jobs for five consecutive months, the number of job losses has so far been mild by the standards of previous recessions
- At the start of the 2001 recession, companies shed around 110,000 jobs each month and almost 130,000 when the 1990 recession began
Working Thoughts 