Friday, January 6, 2012

Mike Gimbel: The December BLS employment figures

The Bureau of Labor Statistics reported the December, 2011 employment/unemployment data this morning. Due to the fact that the seasonally adjusted data and the non-seasonally (real) data are slightly at odds, I'll report my findings in relation to both. Note of caution: there is a natural split at this time of year due to the fact that layoffs usually increase in December.  The problem is, however, that December's non-seasonal layoffs were somewhat worse than the good numbers from the previous 4 months, when compared to previous years.
Seasonally adjusted data:
Official unemployment dropped from 8.65% in November to 8.51% in December. The civilian labor force, however, declined from 153,937,000 to 153,887,000 which is a loss of 50,000. As you are aware, the civilian labor force should increase each month due to population increase. The loss, therefore, of 50,000 indicates continuing problems.
Official unemployment dropped from 13,323,000 to 13,097,000.  That is a drop in unemployment of 226,000. Did those dropped all end up employed? No.
The official "Not in the Labor Force" category increased from 86,503,000 to 86,697,000.  That is an increase of 194,000 in the month of December. While some of this increase is natural, due to retirements and other natural increases, this figure is more than double what it should be. Some of the increase can be assumed to come from the unemployed being dropped from the labor force entirely.
This is not to say that these seasonally adjusted numbers do not imply some slight improvement in employment.  They do. Here's my calculated estimate of the "REAL" unemployment situation, based upon the seasonally adjusted figures published by the BLS:
The real unemployment rate had a peak in July, 2011 of 18.28%. It then dropped to 18.14% in August, to 17.94% in September, to 17.82% in October, to 17.47% in November and to 17.29% in December. That's a total drop of almost a full percentage point. While that's not a huge improvement, when considering the overall rate, it is a positive move in the direction of unemployment. The economy, in terms of employment, continues to be in a depression, not a recession. An unemployment rate of 17.29% is still horrid.
The real unemployment + underemployment (includes those part-time workers seeking full-time work) rate had a peak of 23.37% in September, 2011. It dropped to 22.97% in October. It then dropped to 22.44% in November and to 22.05% in December.  While also being a drop of a little under 1%, the resultant 22.05% isn't something to "write home about"!
Non-Seasonally adjusted data:
The ACTUAL civilian labor force declined for the 2nd straight month, from 154,088,000 in October to 153,683,000 in November to 153,372,000 in December. That's a total ACTUAL drop in the civilian labor force of 716,000 individuals over those two months! That's a huge drop!
The ACTUAL non-seasonally adjusted unemployment rate peaked in June,2011 at 18.38%. This ACTUAL unemployment rate decreased steadily to 16.88% in November,2011. However, In Deecember, 2011, the ACTUAL unemployment rate increased back up to 17.21%.  While the December ACTUAL unemployment rate is almost identical to the 17.29% for the seasonally adjusted data for December, the trend line is opposite from the trend line in the seasonally adjusted data. It is just one month, however. I will have to see how this develops over the next few months.
I should also note that I closely follow the weekly Department of Labor First Time Unemployment Application published data. Those figures do correspond to the BLS reported data.  The DOL report also shows an improvement over the last few weeks.
The big business media has been pushing the idea that getting any job is better than no job.  They have been interviewing workers who are thankful for getting re-employed, despite being taking a job for far less money than their previous job paid. They are pushing workers to accept a lower standard of living. While it is true that having a job is better than no job, that cannot be a solution that workers should just accept without a fight. The ruling class will be very satisfied if workers simply "bow their heads" and accept these crumbs. We cannot allow our class to become so demoralized that they accept this situation without a serious fight.
The Occupy Wall Street movement is a good indication that working people are getting totally fed up. The 99% are beginning to stir from their slumber. Watch out ruling class! When we move, you will come tumbling down from your high and arrogant perch! I think that the labor movement and the progressive movement and left organizations should be thinking hard about the next step in the fightback.
May 1st is less than 4 months away. In 2006 there was a general strike by millions of immigrants on May 1st of that year. The impact was enormous in 2006 and May 1st has remained an important day for demonstrations ever since. This May 1st could be a huge breakthrough event for all the 99%.  Shouldn't the rest of the 99% join the immigrants in a "Day without workers"? That would be a general strike of truly momentous historical importance! I don't know if it can be pulled off, but I do know that it is truly needed to happen!
--Mike Gimbel
Mike's new book: Dialectical Materialism vs. "The New Physics" is for sale on at:
The stupidities and absurdities by which mathematicians have rather excused than explained their mode of procedure, which remarkably enough always lead to correct results, exceed the worst and real fantasies of the Hegelian philosophy of nature.
                                                                  --Frederick Engels

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