The unemplyment rate for January 2011 has come in and it was astounding. Though all analysts projected an increase of unemployment, from 9.4% to 9.5%, the actual numbers came in vastly different. The latest figure is now 9%.
Such a huge and dramatic drop should be wonderful news. It should have sent the stock market soaring several hundred points. Economists should be lauding the Obama Administration, with pundits on the Left declaring a definitive success of the Obama Stimulus. Yet that isn’t happening.
You can’t blame the lack of attention on the events in Egypt. Even though the world is focused squarely on the uprisings in Tunisa, Yemen, Egypt and seemingly the entire Middle East that is not enough to detract from the #1 issue in America for the past 3 years. Jobs remain the priority among Americans, and the American economy is the key to a worldwide recovery. Were this report to be good news, it would be in the headlines right behind Egypt.
The fact is that the latest unemployment numbers are not good.
In the past three months, the economy generated an average of 83,000 net jobs per month. That’s not enough to keep up with population growth.”
The actual number of jobs created can’t even keep up with the growth of the population. In fact the situation is worse than it sounds.
With such bleak news, how did the number of unemployed drop? With such a widespread failure to create jobs (restaraunts and hotels lost 2,200 jobs, temporary agencies cut 11,000 jobs, financial services dropped 10,000, and even the Government eliminated 14,000 positions. Construction lost 32,000 but the big loser was transportation with 38,000 people becoming unemployed) the only logical question is where did the better unemployment number come from?
49,000 jobs were added to manufacturing. 28,000 jobs were created in retail. Huge increases not seen in a year of high unemployment rates. But not nearly enough to account for the chage in national figures. For the unemployment rate to drop this quickly, the largest drop in unemploment for 2 months since 1958, something big had to happen. Something big did indeed happen.
200,000 stopped being counted by the Government. They aren’t getting a check from the Government and therefore do not count as unempolyed anymore. Add to that another stat that hadn’t been broken in a quarter century,
“And the participation rate, which is the percentage of the working-age population working or looking for work, fell to a 26-year low of 64.2 percent.”
The fewest number of people who can work are doing so since 1985.
Put it all together and you get a clear message. Unemployment in the nation is rampant, no matter what the official unemployment rate is shown as. In fact the number of people employed in 2010 has been revised, with 200,000 fewer people employed than originally thought – for a total of 950,000 jobs created for the year. Given these facts it’s a surprise that the Dow Jones Index was able to eek out a 29 point increase on the day.
There is no doubt that as we approach the 2012 Presidential election season the drop in unemployment will be seized upon as a positive. That the figure will be taken out-of-context as an example of the Obama Stimulus and Obama Administration policies working. The use of soundbite politics and polispeak will spin the facts, creating rainbows and launching pigs to the sky.
But the public need only look at the dire situation of New York State, among dozens of States across ther country, to see the reality. 9,800 State jobs are proposed to be cut. Widespread service cuts are being undertaken. Spending freezes and total removal of pay for certain positions are being mandated. All of which still cannot match the loss to the budget for the fiscal year. None of which indicate an improving economy.
The unemployment rate is now 9%, the lowest since April 2009 (when it stood at 9.4%). Yet the only way this could be a positive is if you were to wear rose colored glasses.
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