Wampum

The unemployment rate drops to 6.1%, but...

the economy bleeds another 93,000 jobs.

Total nonfarm payroll employment declined (-93,000) in August to 129.8 million. Over the month, job losses continued in the manufacturing and information sectors. Health care and construction added jobs.

The number of factory jobs decreased by 44,000 in August. Since July 2000, manufacturing employment has declined continuously, shedding nearly 16 percent of its jobs. In August, wood products, machinery, apparel, and electrical equipment and appliances each lost 5,000 jobs. Employment declined by 12,000 in the textile industries.

Employment in the information sector fell by 16,000 over the month. Since its recent peak in March 2001, the number of jobs in this sector has declined by 459,000, or about 12 percent. Telecommunications employment has declined continuously since March 2001 and fell by 7,000 over the month.

Professional and business services employment edged down in August. Within this sector, management of companies and enterprises lost 10,000 jobs. Computer systems design lost 8,000 workers over the month. Since peaking in March 2001, employment in this industry has declined by 232,000. Temporary help employment continued to trend up, although the increases in July and August were notably smaller than the gains in May and June.

Employment continued to decline in wholesale trade. Since its most recent peak in March 2000, wholesale trade employment has decreased by 423,000. Retail trade employment was little changed in August. Employment in transportation and warehousing also showed little change over the month.

Government employment peaked in February and has decreased by 131,000 since then.

There are a few areas of job growth: Healthcare, social assistance and construction. Of course, the medical costs are still rising, so only the wealthy and/or insured will soon be able to afford quality healthcare. Construction may soon taper off as higher interest rates quash new home building. And is there any question as to why, with the recent announcement that the percentage of Americans living in poverty increased significantly last year, more social workers would be needed?

A number of areas of the report which I've followed for months now continue their earlier trends: The number of discouraged workers has now grown by 125K, or 25%, to 503K; the percentage of those unemployed for more than 27 weeks (6 months) has increased to almost 22%; and the number of those desiring work, but still not counted by the Administration as truly "unemployed" has grown to 1.7 million, up from 1.4 million a year earlier.

The number of workers who have left the civilian labor force, for whatever reason (inability to find work, incarceration, returning to school full-time, no childcare, etc.,) has increase by over one million in just two months.

In historical perspective, it is not unusual during times of increasing unemployment for there to be a lull, or even slight decrease, in the upward trend during the dog-days of summer. Such was the case in both 1981 and 1991. Of course, in the following autumns of each of those years, the unemployment rate resumed its previous upward climb. Will history repeat itself once again?

Addendum: It appears that the percentage of the population even participating in the civilian workforce is approaching levels not witnessed since the 1991-92 Bush I recession.

Addendum 2: David A. in comments made the request for a look at "real" unemployment numbers, and you know, I just happened to have just the thing, albeit a month out of date (haven't added in today's numbers yet.) I guess I'll update it and post the new graph here later today.

Posted by MB Williams at September 5, 2003 09:22 AM | TrackBack