A consensus of economists, thinking that we had turned the corner on this recession, were projecting a loss of 175,000 jobs before this morning's latest report. Instead, September lost 263,000 jobs (Click to See Full Bureau Of Labor and Statistics Report). Worse than that, a whopping 706K workers, called discouraged workers, just stopped looking for a job because they had tried didn't but gave up because they were seeing anything out there for them. The total workforce shrank by over a half-million workers because those workers completely gave up and many took early retirement; placing an increased burden on government programs like social security (Click to See Full USA Snapshot Story: "September payrolls drop 263,000, more than expected").
If you add the 263,000 jobs being lost for September to the half-million jobs that were lost due to a shrinking workforce, the true impact to the economy is over 750,000 jobs lost in a single month. That number is really horrible and that's why the true unemployment rate is closer to 17 percent and not the reported 9.8 percent.
Just before labor day, I wrote a blog entry that said we would see higher unemployment in September because those with Summer-only jobs would then re-enter the job market; only to find nothing available. I believe this higher than expect number for September reflects that very projection. There are still a number of summer workers who are due to finally lose their jobs in the month of October -- albeit not as many -- and, again, we should see another high number for the report due November 6th.
With the numbers as bad as they are, I would have expected that the unemployment number to have jumped to 9.9 percent this month. But, once again, the Bureau of Labor and Statistics has appeared to fudge on that number. My guess is that real number will be picked up next month (a 9.9% unemployment rate) and another 1 to 2-tenths of a percent added to it. This should easily result in a reported 10 percent unemployment rate or higher for October's report. I say this because the high-side estimates by economists for this report had placed the job losses at 225,000 with a projected unemployment rate of 9.9%. But, instead, the number of jobs was even higher than that and, yet, the unemployment rate only moved up marginally from 9.7% to 9.8%. That, to me, indicates some obvious fudging.
As always, I want to take another shot at Obama's Stimulus Package: It isn't working!
The latest lie by this Administration is that cops and teachers are being saved by the Stimulus. Well here's a clue for all those clueless talking heads in the Obama Administration: Government jobs fell by 53,000 and the educational component of that number was 29,000 workers; mostly teachers. We have been losing teacher's jobs all along; even though Obama claims to be saving them. I guess one could argue that it would have been even worse without the Stimulus Package but, as usual, that reality would be impossible to prove and the Obama people know that.
The facts don't lie and the facts are that this economy is still tanking. Every month that we have additional job losses is a month where there is another bite being taken out of our economy --- because the overall purchasing power of America keeps declining. That's the reality that the Obama's economics team keeps trying to dance us away from by using their flawed argument of somehow saving and creating jobs.