The Bureau of Labor Statistics reported this morning that the unemployment rate rose to 10.2% and the “true” unemployment rate, which includes discouraged workers and those who want full-time work but can only find part-time jobs, rose to 17.5%. The number of unemployed persons now stands at 15.7 million, more than double the recent low of 7.67 million in April 2008. Total non-farm payrolls fell by 195,000 in October.
The details of the employment reports offer little comfort. Manufacturing employment fell by 61,000. The sector has lost jobs for 23 months in a row and in 38 out of the last 39 months. Fully one-third of the 17.3 million manufacturing jobs that existed in the US at the beginning of this decade are now gone. The situation in construction is as bad, if not worse. In October, there were less than six million construction jobs, down from a peak of 7.7 million in January 2007. There are almost 800,000 fewer today than at the turn of the century
Yesterday, the Labor Department announced that US labor productivity rose an astonishing 9.5% percent in the third quarter. It was the biggest productivity jump since 2003, but it came on the back on workers, whose hours of work fell by 5% from the second quarter. In fact, the year-over-year decline in hours worked of 7.5% was the largest since record-keeping began in 1948. As in all recent recessions, business has been forced to find ways to do more at less cost.
There are, however, two bits of good news in the data. First, job losses in September and August were revised downward by 91,000. Second, the pace of losses is clearly slowing. The three-month average of monthly job losses is down to 188,000 from 428,000 in the second quarter and 691,000 in the first quarter. It’s likely that most businesses are now working with as limited staffing as they can. But, the question of when we will finally see employment increase remains to be answered.
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