The "Bad" of the December Employment Report: The Average Worker Loses Purchasing Power

According to the latest Employment Report, the month of December saw an increase of 252,000 jobs, and the unemployment rate fell to 5.6% from the prior month's 5.7%.

Now, that sounds like a good report.  One that President Obama is sure to take credit for.

However, there's another bit of news that you won't hear him talk about.  That news is that the average hourly wage fell by 5 cents.  While 5 cents per hour doesn't sound like much, when its annualized and applied to a workforce of more than 156 million Americans, that loss of 5 cents is an equivalent annual loss of more than $16 billion dollars in overall wages; and, those are billions of dollars that won't be applied to growing the economy.

The fact is, that since 2010 and the employment recovery, too many Americans have lost good paying jobs only to be rehired at lower salaries; resulting in stagnant wages.

This is why, more than anything, Americans have given the President low marks on the economy and why, consistently still place it as their number one priority.  No amount of political speak or the touting of how many jobs he's created is going to make the average American feel good about themselves or the economy.

References:

US created 252,000 jobs in Dec vs. 240,000 est; unemployment rate at 5.6% vs. 5.7% est: http://www.cnbc.com/id/102324257

Wage Stagnation Puts The Squeeze On Ordinary Workers: http://www.foreconomicjustice.org/13657/wage-stagnation-puts-the-squeeze-on-ordinary-workers

President Obama Job Approval - Economy: http://www.realclearpolitics.com/epolls/other/president_obama_job_approval_economy-2820.html

Priorities: http://www.pollingreport.com/prioriti.htm

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Why You Shouldn't Trust The November Jobs Creation Number

Following the release of the November employment report last Friday, the headlines loudly trumpeted the fact that 321,000 new jobs had been created.  Yet, despite this, and very oddly, the unemployment rate remained the same as October's report; even though September and October were, at the same time, revised upwards to include another 44,000 new jobs.  So, all in all, there was a net increase of 365,000 jobs but no drop in the unemployment rate.  By contrast, October saw more than a third less jobs being created and the unemployment rate fell one-tenth of a percent.

But, the fact that the unemployment rate didn't go down is quite bothersome and definitely needed a closer look.

Logically, if there was true job creation, the number of unemployed should have fallen by 321,000 and, the number of employed should have risen by an equal amount; resulting in a lowering of the unemployment rate by two-tenths of a percent to 5.6%  But, when you look at the actual data, none of those things happened.

Excerpted Chart: Full Chart Linked Below

In actuality, the number of unemployed went up by 115,000.  Not down and the number of employed only rose by 4,000.  Not by the expected 321,000.  So, it's no wonder that the unemployment rate held steady.  In reality, these two facts, when taken together, actually prove that no jobs were created in the month of November.  Instead, there was a net loss of 111,000 jobs in November.

To me, this only makes sense unless, of course, there is some adjusting going on as a result of previously fudging the numbers ahead of last month's election, in much the same way that numbers were fudged ahead of the 2012 election.  We'll have to wait and see if some large media outlet reports on the very same numbers I'm seeing.

References:

Washington Post: This is what a real recovery looks like: The economy added 321000 jobs:  http://www.washingtonpost.com/blogs/wonkblog/wp/2014/12/05/this-is-what-a-real-recovery-looks-like-the-economy-added-321000-jobs-in-november/

U.S. Adds 321,000 Jobs In November; Unemployment Rate Remains At 5.8%: http://www.huffingtonpost.com/2014/12/05/november-jobs-report-unemployment-rate_n_6271366.html

Employment Situation Summary Table A. Household data, seasonally adjusted: http://www.bls.gov/news.release/empsit.a.htm

Economy Adds 214,000 Jobs in October, Unemployment Rate Falls to 5.8%: http://time.com/3572116/new-jobs-report/

Census 'faked' 2012 election jobs report | New York Post: http://nypost.com/2013/11/18/census-faked-2012-election-jobs-report/

'Fake' Unemployment Report Shocker - Forbes: http://www.forbes.com/sites/investor/2013/11/19/fake-unemployment-report-shocker/

More Tampering With The Unemployment Report?

In September 2012, just before the election, there were obvious inconsistencies in the monthly Employment Situation Report and the surprising drop in the unemployment rate that caused people to suspect someone of cooking-the-books. In fact, there were a number of chefs in the old Census Bureau's kitchen who were busy cooking and serving up a very nice pre-election cake for the President (see below).

Now, based on Friday's jobs report, it appears that the chefs were at it again.

The only way to lower the number of unemployed is for an unemployed worker to either find a job or just give up looking for work.  Friday's report said that 74,000 found work and 347,000 left the workforce because they were no longer counted as looking for work; a combined total of 341,000 that are no longer unemployed.  Yet, the report reflected a drop of 490,000:

Obviously, there is a 69,000 unaccounted for error in the number of those now being unemployed; and, I think, for political reasons.  My guess is that the "unaccounted" are being used to hide the fact that even more workers left the workforce than the 347,000 that were stated in the report.  While the 347,000 is bad enough, another 69,000, or a total 416,000, would look even more horrible; at least politically.

God only knows how much of the rest of the report is using "fuzzy" math.


References:

Census 'faked' 2012 Election Jobs Report: http://nypost.com/2013/11/18/census-faked-2012-election-jobs-report/

December 2013 Employment Report, Table A: http://www.bls.gov/news.release/empsit.a.htm

The Big Lie: Workforce Contractions Are Due To Baby Boomers Retiring.

It seems like, every time there's another one of these head-scratching and really questionable employment reports -- where the only reason for the unemployment rate falling is a shrinking workforce -- a bunch of talking-heads crawl out of the woodwork to justify the declines on the basis of a well-worn lie that 10,000 "Baby Boomers" are retiring every day.

This time around, the "Baby Boomer" spin is in defense of the December report where only 74,000 jobs were created; yet, the unemployment rate fell three-tenths of a percent to 6.7%.  A feat that could only have happened because, in addition to the 74,000 new jobs, 347,000 previously unemployed workers left the workforce; resulting in a net benefit of 421,000 jobs.  Which, by the way, is close to, but still well short of the 462,000, truly needed to lower the unemployment rate by three-tenths of a percent.

The 10,000 a day number is simply based on the fact that, during the Baby Boom years (1946-1964), a near average of 10,000 babies were born each day; starting with 7,700 babies being born per day in 1946 and rising to a high of 11,800 babies in 1961.  But, this number wrongly assumes that every "Baby Boomer" will live to retirement; or, that no "Boomer" will work beyond retirement; or, that, somehow, no one is standing in line to replace these retiring workers.

According to Life Expectancy Tables and Actuarial Life Tables, a person born in the Baby Boom years  had 29.5% probability of dying by age 65. Therefore, in reality, only about 7,000 workers a day are actually retiring; not 10,000. At the same time,  almost 11,000 youths per day, age 16 and older and born in the 1990's, should be entering the workforce.  This based on the fact that, since 1989, an average of more than 4 million babies per year were being born. What this means is that the workforce should be growing by a minimum 120,000 a month; not declining by 347,000 as in the December employment report.  On top of that, because this recovery has been the worst in history and because personal wealth (value of homes) has declined, many seniors are being forced to work well past retirement age.


References:

December Employment Report: http://www.bls.gov/news.release/empsit.toc.htm

Births Per Year: http://www.infoplease.com/ipa/A0005067.html

United States Life Tables And Actuarial Life Tables: 1939-1941, 1946: https://archive.org/details/unitedstateslife1940unse

Actuarial Life Tables 2009:  http://www.ssa.gov/oact/STATS/table4c6.html

Life Expectancy By Year: http://demog.berkeley.edu/~andrew/1918/figure2.html

January 2009 Employment Report: http://www.bls.gov/news.release/empsit.a.htm

We Are Seeing The Distruction Of The Workforce

Once again the rate of unemployment fell.  This time by two-tenths of a percent to 7.7%.  Sounds pretty good. Doesn't it?

But, the cost of that better-than-expected unemployment rate was very high.  For every worker who found a job last month, 3.9 just gave up looking for work.  In fact, more than 1/2 million workers stopped hunting for work of any kind. 

This has been the case, all along, since the unemployment rate started falling in 2010 from a high of 10.2%.  On average, for every person who does find a job, at least 2.4 gave up looking.   This is not a recovery.  This is a month-by-month destruction of our workforce.  It is why the average family's income in America fell by more than $4000 a year.  People are losing good jobs; only to find and take lower paying positions. It is why the number of people on food stamps has risen 57% in the last 3-1/2 years or why the number of those in poverty and in low income jobs has doubled under Obama. 

--- CNBC: Morici: Unemployment Rate Falls: More Quit Looking: http://www.cnbc.com/id/100289926

Two Unemployment Numbers Signal A Further Slowdown In The Economy

For most people, the unemployment rate and the number of jobs created is all they care about when the jobs report is released each month.  But, there are internal numbers buried in that report that can tell us a lot about what's happening in the economy in general. 

This month, two numbers were significant.

First, manufacturing jobs declined by 15,000 workers in August.  This is the first time this number has gone negative in almost a year.  Now, certainly, one month isn't a trend; but, the drop in manufacturing jobs does seem to be consistent with other economic numbers that have shown a slowdown in manufacturing.  Take, for example, the Institute for Supply Management's Factory Index measurement.  For 3 months in a row, it has fallen; and fallen below the 50% mark that would otherwise indicate an expansion of factory orders.  That index, now sitting at 49.6%, indicates that manufacturing is contracting, and the August drop in manufacturing jobs is consistent with that contraction.

Then, there's the decline in the average work week for manufacturing workers.  In the August jobs report, the average work week slipped by two-tenths of an hour to 40.5 hours.  Normally, a slippage in this number would mean that overtime hours were being minimized by hiring more workers.  But, the number actually fell in the month.  This, then, means that manufacturing overtime hours (those hours above a 40-hour workweek) were in decline.  This is just the opposite of what you want in a growing economy.  Increasing overtime hours -- hours paid at time-and-a-half or double-time -- usually force a manufacturer to hire new workers, but  falling hours without new hires means that manufacturing output is in decline.  And, if manufacturing output is falling, so is the economy.

August Jobs Report: http://www.bls.gov/news.release/empsit.nr0.htm

Institute for Supply Management's Factory Index report: ISM factory index contracts for third month: http://articles.marketwatch.com/2012-09-04/economy/33571413_1_ism-survey-new-orders-index-factory-sector

Debunking The 10,000 Baby Boomers Retiring Every Day Claim

This post has been updated.  Please go to this link: http://cuttingthroughthefog.blogspot.com/2014/01/the-big-lie-workforce-contractions-are.html

Expect Higher Unemployment Rates As The Employment Situation Improves

On Friday, it was reported that the unemployment rate held steady at 8.3%. This was despite adding 227,000 new jobs in February and despite adding another 62,000 jobs that were previously under-reported for January and December. So why not a drop in February? After all, the it fell two-tenths of a percent in January with almost the same number of jobs being added to the economy as were added in February.

The reason lies in "how" the Bureau of Labor Statistics (BLS) under-reports the unemployment rate by "not" counting workers who are so discouraged that they stop looking for work. February's rate held -- despite adding jobs -- because some of those formerly discouraged workers came off the benches and started looking again. We know this from the BLS' own press release where it was noted: "The civilian labor force participation rate, at 63.9 percent, and the employment-population ratio, at 58.6 percent, edged up over the month." As a result, the base on which the unemployment rate is calculated increased enough to completely offset the addition of any new jobs and it remained at 8.3%. Actually, if just a few more discouraged workers had started job seeking, the unemployment rate could have easily edged upwards to 8.4%; thus contradicting any increase in newly added jobs.

But, this phenomenon of higher unemployment rates in an a supposedly improving employment situation is the punishment for having under-reported the true rate through the exclusion of discouraged workers. Right now, those non-job-seekers are hearing from this President and the mainstream media that the jobs picture in this country is improving. Of course, most of this commentary is being done for political gain in this, an election year. Whether or not the jobs picture is actually improving remains to be seen. But, if discouraged workers actually "think" the jobs situation is better, more and more of them will start looking for work and the size of the workforce will grow. In doing so, the unemployment rate will either hold or actually go up. This is why I think that those who seem to think Obama will have unemployment below 8% by the November elections are all wet. When you really think about, Obama's talking up the economy for political gain might actually have the opposite effect by increasing the unemployment rate; and he could very well lose the election for that reason. If that should happen, it will, again, prove that honesty is the best policy. In other words, those who live by a lie will (figuratively) die by a lie.

A Simple Tweet Says It All About Today's Unemployment Report

This morning, a simple and concise tweet by financial columnist, James Pethokoukis, cut through all the media enthusiasm over this morning's unemployment number. His tweet was as follows: "10.9%: The unemployment rate (U-3) if the size of US workforce was the same as when Obama took office, not 8.5%". He's right. In essence, he's saying that the unemployment rate is a deceptive number because it doesn't include all those people who stopped looking for work because there are no jobs to find.

But, to me, Jim's tweet stops short of another fact. His tweet doesn't include the workers who should have been added to the workforce due to population growth over the last three years. That's another 5.6 million workers who aren't being counted in either the Bureau of Labor and Statistics report or in Jim's calculation. That's why many believe the true unemployment rate is actually above 20%. Of course, a true reporting of the actual unemployment rate would be political suicide for both Obama and the Democrats.

This Morning's Jobs Report Just Screams Fraud!

Most all of this morning's economic news headlines read like this one from Bloomberg news: U.S. Jobless Rate Unexpectedly Declines to 8.6%.

So, supposedly, we added enough jobs to lower the unemployment rate by four-tenths of one percent from last month's rate of 9%. To put this into perspective, we currently have a labor force of about 154 million workers. To achieve a four-tenths lowering of the unemployment rate, we needed to add over 600,000 new jobs. Now, according to the report, itself, we only added 120,000 jobs in November. Then, going back to October's data, that previously reported number was revised upwards by 20,000. Therefore, overall, only 140,000 jobs were supposedly created in this reporting period. Certainly, well short of the needed 600,000. What's worse, the report also states that the workforce shrank by 315,000 workers because those unemployed workers grudgingly gave up looking for work. Therefore, the net of this report is that our economy actually "lost" 175,000 jobs. Yet the unemployment rate fell dramatically.

The reality is that this report doesn't jive with its own internal facts. It also doesn't jive with the last Gross Domestic Product (GDP) report which had been revised downwards to a mere 2% economic growth in the last quarter. Most economists would tell you that you would need a minimum of 2.5% GDP growth before there would be any "real" job creation and a "true" lowering of the unemployment rate. Lastly, this report certainly doesn't match up with the fact that the jobless claims numbers have consistently stayed near or above the 400,000 level. Simply speaking, this morning's report is either an incompetent handling of the data or, what's worse, a blatant political deception.

Already, this morning, key Democrats and the liberal media are falling all over themselves in jubilation of the lowered unemployment rate. All are singing praises to Obama's economic policies. Even Obama hit the microphones to lay claim to "his" creation of 120,000 jobs in November. But, as I have shown, that claim ignores the realities in order to "politically" deceive the public. The fact is that we need to grow the labor force by a minimum of 166,000 jobs, each month,in order to keep up with simple population growth. Obama is a fraud. Throughout his term in office, there has never been a month where there has been any true job creation. And, that's the truth that Obama continues to hide, month after month, in an attempt to prove that his economic policies are working and that he should be reelected.

Striking Verizon Workers Were Counted As Unemployed???

According to the FAQ (Frequently Asked Questions) at the Bureau of Labor and Statistics (BLS) own website, workers involved in an "industrial dispute" -- a strike -- are counted as being employed and should never appear in any section of the Monthly Unemployment Report as being unemployed. Here's the actual text from the pertinent BLS FAQ:

"Who is counted as employed?

Not all of the wide range of job situations in the American economy fit neatly into a given category. For example, people are considered employed if they did any work at all for pay or profit during the survey week. This includes all part-time and temporary work, as well as regular full-time, year-round employment. Persons also are counted as employed if they have a job at which they did not work during the survey week, whether they were paid or not, because they were:

On vacation
Ill
Experiencing child-care problems
Taking care of some other family or personal obligation
On maternity or paternity leave
Involved in an industrial dispute
Prevented from working by bad weather"

Yet, in this morning's Employment Report, 45,000 striking Verizon workers were tallied in the unemployment stats for "Information Technology" workers and, then, were rolled up into the final count; reflecting zero jobs being gained for the month. This fact was duly noted in the first paragraph of this morning's BLS news release, when it was stated: "a decline in information employment reflected a strike". (Click here to see the actual BLS new release) However, if the striking workers were properly counted as being employed, there should have been a job growth of 45,000 jobs for the month instead of the reported zero.

So, what gives? Are striking workers now suddenly being included as part of the unemployment stats when they have never been counted this way in the past? Was the inclusion of the striking Verizon workers a convenient way of making this report look worse than it really was in order to help Obama get support for his jobs speech and plan of next week? Something really stinks on ice with this one! After all, the BLS is a government agency that reports to Obama through the Secretary of Labor and, I wouldn't put it passed that agency to tweak the numbers for the greatest possible political leverage. Then, next month, the BLS will just correct the problem with one of their many and constant statistical "revisions". In the meantime, we just might be seeing another one of Obama's deceitful manipulations of the facts.

The White House Predicts Its Own, Failed Reelection Bid?

This morning's Employment Report was just horrible. The job growth for last month was "zero" and you have to go all the way back to 1945 to match that kind of a nearly impossible statistic. Additionally, the unemployment rate held steady at 9.1%.

Even worse than today's horrible report, yesterday, the White House budget office dropped an "unemployment projection" bombshell that hardly bodes well for Obama's reelection bid. In a newly revised projection, the budget office now predicts that the unemployment rate will remain above 9 percent through the end of 2012. Previously, they had predicted an 8.6 percent rate for 2012 (Click here to See "The Hill" Story: "White House downgrades 2012 jobs, economic forecasts; cites 'turbulence'").

To put this into context, no President has won a reelection bid since FDR with an unemployment rate above 8%. One has to wonder why the White House would release this reelection-killing projection right now; just days before the President's jobs speech. Do you think maybe it is a psychological ploy to get Congress to act on Obama's jobs plan. I think so. This President and his team does absolutely nothing without calculating its political impact. Obviously, they're betting that, if they overstate a negative and, then, the economy actually does better, Obama will benefit by saying he beat the estimates.

Going Forward, The Unemployment Rate Should Rise

Following this morning's reported gain of 116,000 workers in the labor force for July, a few too many on the political left were popping the champagne corks and declaring the trend is now positive for job growth. But, what most seem to be forgetting (probably, intentionally) was the Mass Layoffs report that was just issued a couple of days ago. That report from the U.S. Bureau of Labor and Statistics indicated that "announced" layoffs in the private sector rose to a 16-month high (Click here to See Story: U.S. Layoffs Soar to 16-Month High in July).

The reality is that the amount of announced layoffs seems to be accelerating and that doesn't bode well for any future unemployment reports.

Behind This Morning's Unemployment Number

Later on today, the President will have another one of his speeches/pressers to talk about this morning's unemployment report. Expect him to tout his job creation record but don't be fooled by his spin.

According to the headline numbers, the workforce added 116,000 new jobs and the unemployment rate fell from 9.2% to 9.1%.

However, you should understand that our workforce grows -- based on normal population growth -- by 1.3% annually. This means that we add about 2 million new workers to the labor force each year. Therefore, on a monthly basis, we need to add at least 166,000 jobs in order to keep up with that growth. By only adding 116,000 jobs, we actually fell short of our growing workforce by 50,000 jobs; making the "true" number a "negative" number for the month.

On top of that, the only reason that the unemployment rate fell to 9.1% is because 193,000 unemployed (discouraged) workers, who were "not" actively looking for a job, were completely "dropped" from the total labor market. By decreasing the size of the workforce and, at the same time, adding a few jobs, the unemployment rate is being artificially distorted.

Actually, if you add the miss on the job market growth to the amount of discouraged workers who were being dropped from the workforce, we really had a loss of 243,000 jobs in the month and not some bogus growth number of 116,000. At the very least, the unemployment rate should have remained the same.

Hey Geithner! No Jobs. No Recovery!

Earlier this week, Tim Geithner, Obama's Treasury Secretary, wrote an op-ed in the New York Times that was titled: "Welcome to the Recovery". In it, he pretty much gives himself and his boss a pat on the back for saving the economy. Like Obama, Geithner is trying to push the idea that things would have been a lot worse if the Democrats hadn't passed the Stimulus Package. But, Mr. Geithner can't seem to understand that the economy, as I have written before, was actually starting to recover on it's own before any stimulus moneys went out the door in August of 2009 (Click here to My Commentary: The Big Stimulus Package Lie!). In reality, with the stimulus spending well in place, the situation now appears to be getting worse; not better.

With this morning's jobs report, we now know that our economy lost another 350,000 combined jobs in the months of June and July and it really doesn't matter if any of those lost jobs were for a Census worker or a guy flipping hamburgers. A job loss is a job loss and, you don't continue to lose jobs in a recovering economy. Further, any increase in monthly job losses will only have debilitating effect on the economy; making it much more difficult for it to truly enter a recovery stage.

I, for one, am getting really tired of the unprovable political B.S. from the likes of Geithner, Biden, and Obama that jobs have been saved or created and that things would have been a lot worse without the Stimulus Package. That song is getting quite tiring; especially when we continue to see a slew of economic numbers that show that the economy might actually be stumbling again.

Horrible. But, A Better Than Expected Jobs Number.

OK, I was wrong. I had projected a loss of 200,000 jobs for last month; and, only 125,000 jobs were actually lost (Click here to See Story: Payrolls drop by 125K, jobless rate falls).

If you net out the 225,000 Census workers who were let go, there was actually a net job creation of 100,000 workers in the month. This was certainly better than the prior month's job's increase of 21,000. However, of that 100,000 new jobs, only 83,000 were in the private sector; with another 17,000 tax-eaters being added to the government payrolls. Sadly, this 83,000 falls well short, by at least a factor of 2, in just covering normal population growth. Therefore, you can only conclude that job growth in this country is seriously slumping after seeing two months of horribly weak numbers.

However, thanks again to the magic of creative math, the unemployment rate fell tw0-tenths of a percent to 9.5% because the Bureau of Labor and Statistics concluded that 652,000 workers just quit looking for work and, therefore, really weren't a part of the overall workforce. The under-employment rate, once at a post-Great Depression record rate of 16.9% before any Census workers were added, was better again last month, but still at a breath-stealing rate of 16.5%

As usual, our hero, Barack, put as much political spin as possible on this terrible number by claiming it was the 6th straight month of job growth this year. He also had the gall to claim that 600,000 jobs were added to the economy when, just last month, 652,000 completely stopped looking for work out of sheer frustration. If B.S. was rocket fuel, Obama could rocket his way to the farthest galaxies.

The Persistence of a Jobless Recovery

Some economists seem to think that the recession was over a year ago. However, the group charged with the responsibility of umpiring that call, the National Bureau of Economic Research (NBER), has still not declared this recession as being over. Theoretically, two positive quarters of growth in the Gross Domestic Product (GDP) should be the signal for such a call; and, we've had three. Yet, the NBER still remains silent.

I think the NBER is concerned about the employment situation; which, by any measure, is stalled out. As a result, any economist worth his/her salt is probably thinking that a double-dip recession is ahead of us. I think this potential reality has kept them in limbo with regard to calling the recession over.

Certainly, the initial jobless claims number that was released this A.M. gave the NBER no reason to think the economy has recovered. Once again, the number came in over 450,000 jobs. In fact, it jumped 12,000 jobs from last week's number to 472,000 claims; and, that previous number, too, was upped by 4,000 additional laid-off workers (Click here to See Story: Jobless claims rise 12,000 to 472,000). Additionally, the number of long-term claimants rose by 88,000 for the month and approximately 350,000 just fell off the roles completely because their unemployment benefits completely ran out.

This morning's horrible number in combination with last week's bad one just shows that the economy is weakening; not growing as the Obama Administration would have you and I believe. Both of these numbers, in conjunction with the miserable unemployment report of almost two weeks ago, speaks volumes as to the failure of the stimulus package to create jobs.

Don't expect anything to get better soon. In fact, the job picture is only sure to get worse next month as thousands of workers are laid off due to the suspension of off-shore oil drilling. Then, too, I think the number of non-spill related job losses is already on the rise as small and large businesses, alike, try to fight to survive the impending impact of ObamaCare and the elimination of the Bush tax cuts in January. Also, lets not forget that companies might further, be in a kind of hiring abeyance as they mull over the impact of Cap and Trade or carbon penalties that may hit their particular businesses as well. No one should kid themselves into believing that this President, his Administration, and the Democrats of Congress are, somehow, economy and job friendly.

The Lack Of Retail Sales Confirms Last Friday's Jobs Number

Last Friday, the employment number was terrible. If you stripped out the temporary census worker jobs and, then, netted the loss of other government jobs against the slight growth in the private sector, only 21,000 jobs were created last month. On average, that's only 400 jobs added per state. In fact, 400 people would hardly fill "half" the seating available in an average high school gym.

This morning, the Retail Sales number was also abysmal. Sales in the last month fell by 1.2 percent. This confirms why last Friday's employment number was so bad. Since 70% of the jobs in this country come from small businesses and, primarily, from retailers like your local franchised McD's or your local independently owned gas station, it is no wonder why those business didn't hire last month. People just weren't buying as much as they were in previous months. Quite simply, it takes increased buying for any retail business to even consider any new hires.

Now, one month's set of numbers doesn't necessarily spell a trend. However, if the consumer is seen as pulling back in the next report or in the next few months ahead, the economy will have stalled and the economic recovery will definitely be put off. If that be the case, we easily could see the double-dip recession that so many economist have been worrying about.

Only 20,000 Real Jobs Added To The Economy In May

The May Unemployment Report is out and the numbers are astoundingly dismal. Like I predicted in yesterday's blog, the bulk of the jobs created in May were for temporary Census worker positions. In fact, of the 431,000 jobs created, 411,000 were Census workers; leaving the net increase to be about 20,000. Further, previously reported numbers for March and April, were lowered with a loss of an extra 22,000 jobs. Therefore, in reality, the 20,000 jobs created in May were more than offset by the 22,000 additionally lost in the prior two months (Click here to See Story: Jobs Growth Is Disappointing Due to Weak Private Sector).

Once again, the economists were shocked. They had predicted a growth of 500,000 to 575,000 jobs for the month. Economist and Presidential cheerleader at Moody's, Mark Zandi, had actually predicted 575,000 jobs in May (Click here to See Story: Census hiring to spike job figures in May). For reference, Zandi is one of the economic idiots who wholeheartedly backed the failed Obama/Democrat stimulus package. But, if Zandi and the rest of the economists would simply Google the word "layoff", they'd understand that the employment situation in real life is job losses and not job creation. That's why I've been so negative about the economy for months now.

From a political standpoint, this poor jobs' number will cause the Democrats -- literally in panic for their very own jobs in the Fall elections -- to push for another stimulus package. However, I think they've already proven they haven't a got a clue how to create or even save a single job in America.

Additionally, the Census jobs' number might be phony. The worker tally in the May report might just be a faked number through an intentional process of hiring and rehiring people a number of times to inflate the Census headcount. This charge was made yesterday by a whistle blower who has been rehired and trained by the Census Bureau a total of 5 times:



I read this morning that Obama touted the hiring of all those new Census workers (Click here to See Story: Obama: Economy 'getting stronger by the day'). What most liberals, like Obama, don't seem to understand is that you need to create at least 18 private sector jobs in order to have enough income tax revenue to cover the cost of hiring "one" new, Federal government worker. That's because 1/2 of those newly-created private sector jobs won't pay any taxes; leaving the total burden of paying for any new government position to the other half. The reason being that most government workers get paid more and get more health and retirement benefits than equivalent jobs in the private sector. And for our state governments, the government to private sector job ratio is even higher. This is why countries like Greece and states like California are in such deep trouble. Throughout this recession, Obama and Democrats have been creating more and more government jobs while protecting state government jobs like teachers, police, and fireman. At the same time the number of jobs in the private sector has kept shrinking. That, my friends, is a complete recipe for disaster and easily raises the potential for a double-dip recession in the coming year.

Another 9.7% Unemployment Rate Report?

According to the Bureau of Labor and Statistics, the unemployment rate held steady at 9.7% (Click to See Full Story: Payrolls fall by 36,000; jobless rate steady at 9.7%).

What is amazing is the fact that, each month, the unemployment rate either holds steady (as in this February) or falls (as was the case in January) despite job losses. This month's report for February showed that 36,000 more people became unemployed. In addition, the number of people who lost their jobs in January was adjusted upwards by another 35,000 unemployed workers from the previously reported number. Add to those numbers the fact that the Federal Government added 15,0000 Census workers whose jobs will go away in few months and, effectively, this report is saying that 84,000 "more" workers have lost their jobs in the last two months. Yet, the unemployment rate remains the same.

What's even more disturbing about the report is the fact that the discouraged workers -- those who have completely given up looking for work -- rose from 16.5% to 16.8%. The discouraged workers number is what the Bureau of Labor and Statistics has been using to keep the unemployment rate artificially low. As I have said before, this exclusion of people who have given up looking for work from the greater workforce just makes those workers who do have a job a greater piece of a smaller workforce; making the unemployment rate appear to be less.

Now, to my last comment and the effect of the weather on this report. Even, the Bureau of Labor and Statistics, who mentioned the weather as part of their report, said they couldn't quantify it. So, Obama's chief economic adviser, Larry Summers, was all wet to say that weather would distort the unemployment picture. Then, too, I was wrong in saying that the unemployment rate would be higher than 9.8%. I guess I was too naive in thinking that the number of discouraged workers would abate and the unemployment number would start to rise again.

While, the media headline number will show an unemployment situation that is improving by leveling off, the reality is less than optimistic if you look below the surface. Every week, the economy continues to report that more than 469,000 workers are joining unemployment lines; and, that is a reality that says thing are still bad, economically and mentally, in this country. We really won't start creating jobs until that number gets below 350,000 on a weekly basis. Until then, this economy will still be in the doldrums.