Hiring Slowed in September as Unemployment Rate Fell to a 50-Year Low to 3.5%.

Job growth was steady last month. The economy lost some momentum, though, as the trade war hurt manufacturing and global growth cooled.

By PATRICIA COHEN

I READ THE NEWS TODAY

A job fair in Philadelphia last week. Credit Matt Rourke/Associated Press        

Hiring Is Strong and Jobless Rate Declines to 6.1%


The jobs numbers for the month of June came in stronger than expected with 288,000 added. As a result, the unemployment rate has dropped to 6.1%, which is the lowest since the collapse of Lehman Brothers in September 2008. Economists had expected a gain of between 200,000 to 250,000. According to the Bureau of Labor Statistics, the job gains were across the board in professional and business services, retail, healthcare, and food services. So far in 2014, the number of unemployed persons has declined by 1.4 percentage points, or 2.3 million people. The number of long-term unemployed also dropped by 293,000 to 3.1 million.

Many segments of the economy have rebounded — including corporate profits, Wall Street and the housing market — even as payrolls inched higher at a grindingly slow rate. Now, these broader economic gains are prompting businesses to actually hire significantly more workers in response to growing demand, rather than taking half steps, like adding hours to stretch existing work forces.

Despite the broad gains, the economy is still a long way from its peak before the housing bubble burst and the recession began at the end of 2007. The broadest measure of unemployment, which includes people who are working part time because full-time positions are not available, stands at 12.1 percent. And the proportion of Americans in the labor force has been stuck for three straight months at 62.8 percent, a 36-year low, and is down sharply from 66 percent in 2008.
But the recent healthy level of hiring looks more sustainable than it has in years. Factoring in June’s increase and upward revisions for estimated hiring in April and May, employers added an average of 231,000 workers a month in the first half of 2014, the best six-month run since the spring of 2006


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JUDGE CALLS CHARGES AGAINST 'CANNIBAL COP'  FANTASY & FREES OFFICER



Read it at New York Post

‘Cannibal Cob’ Gilberto Valle is about to taste freedom. Valle was granted release by a Manhattan judge on Tuesday afternoon on a $100,000 bond and will serve house arrest.

Late Monday, a federal judge overturned the former New York police officer’s conviction, saying there was insufficient evidence for the charge that he plotted to cook, eat, rape, and murder women. Judge Paul Gardephe wrote in his reversal that “the evidentiary record is such that it is more likely than not the case that all of Valle’s Internet communications about kidnapping are fantasy role-play.” Gardephe did uphold Valle’s second count of illegally using NYPD databases to target women, but Valle has already served over a year in prison, which meets the sentencing requirement for that crime.

ECONOMIC RECOVERY SLOGS ALONG. KRUGMAN RECS YELLEN TO LEAD FED

A job fair in Emeryville, Calif.

The economic recovery continues to chug slowly along. The unemployment rate dropped to 7.4 percent, the lowest rate since December 2008, but only 162,000 new jobs were created in July, fewer than economists expected. The number of new jobs was revised down for both May and June as well, and the labor force participation rate—the share of people with jobs or actively looking for them—remained about the same. Most of the gains came in retail, food services, and the financial industry.

Read it at Bureau of Labor Statistics

August 2, 2013 7:58 AM

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PAUL KRUGMAN N.Y. TIMES

 

Can a woman effectively run the Federal Reserve? That shouldn’t even be a question. And Janet Yellen, the vice chairwoman of the Fed’s Board of Governors, isn’t just up to the job; by any objective standard, she’s the best-qualified person in America to take over when Ben Bernanke steps down as chairman.

 

Yet there are not one but two sexist campaigns under way against Ms. Yellen. One is a whisper campaign whose sexism is implicit, while the other involves raw misogyny. And both campaigns manage to combine sexism with very bad economic analysis.

Let’s start with the more extreme, open campaign. Last week, The New York Sun published an editorial attacking Ms. Yellen titled “The Female Dollar.” The editorial took it for granted that the Fed has been following disastrously inflationary monetary policies for years, even though actual inflation is at a 50-year low. And it warned that things would get even worse if the dollar were to become merely “gender-backed.” I am not making this up.

 

True, The Sun is a marginal publication, with strong gold-bug tendencies, and nobody would pay much attention if the rest of the right had ignored or distanced itself from that editorial. In fact, however, The Wall Street Journal immediately followed up with its own editorial along the same lines, in the course of which it approvingly quoted The Sun piece, female dollar and all.

The other campaign against Ms. Yellen has been subtler, involving repeated suggestions — almost always off the record — that she lacks the “gravitas” to lead the Fed. What does that mean? Well, suppose we were talking about a man with Ms. Yellen’s credentials: distinguished academic work, leader of the Council of Economic Advisers, six years as president of the San Francisco Fed, a record of working effectively with colleagues at the Board of Governors. Would anyone suggest that a man with those credentials was somehow unqualified for office?

Sorry, but it’s hard to escape the conclusion that gravitas, in this context, mainly means possessing a Y chromosome.

Larry Summers
 

Both anti-Yellen campaigns, then, involve unmistakable sexism, and should be condemned for that reason. As it happens, however, both campaigns have another problem, too: They’re based on bad economic analysis.

In the case of the “female dollar” types, the wrongheadedness of the economics is as raw and obvious as the sexism. The people shouting that the Fed is “debasing the dollar” have been warning of runaway inflation any day now for almost five years, and they have been wrong every step of the way. Worse, they have shown no willingness to admit having been wrong, let alone to revise their views in the face of experience. They are, in short, the last people in the world you should listen to when it comes to monetary policy.

The wrongheadedness of the gravitas crowd, like its sexism, is subtler. But to the extent that having gravitas means something other than being male, it means being what I like to call a Very Serious Person — the kind of person who talks a lot about the need to make tough decisions, which somehow always involves demanding sacrifices on the part of ordinary families while treating the wealthy with kid gloves. And here’s the thing: The Very Serious People have been almost as consistently wrong, although not as spectacularly, as the inflation hysterics.

 

This has been obviously true in the case of budget policy, where the Serious People hijacked the national conversation, shifting it away from job creation to deficits, on the grounds that we were facing an imminent fiscal crisis — which somehow keeps not coming.

But it has also been true for monetary policy. The Wall Street Journal (news department, not editorial) recently surveyed the forecasting records of top policy makers at the Fed, whom it divided into “hawks” (officials who keep warning that the Fed is doing too much to fight unemployment) and “doves” (who warn that it’s doing too little). It found that the doves made consistently better forecasts, with the best forecaster of all being the most prominent of the doves — Janet Yellen.

The point is that while the gravitas types like to think of themselves as serious men (and I do mean men) who are willing to do what needs to be done, recent history suggests that they’re actually men who are eager to prove their seriousness by doing what doesn’t need to be done, at the public’s expense.

Also, there was a time not along ago when almost everyone in the gravitas crowd, if asked who possessed that mystical quality in its purest form, would surely have answered “Alan Greenspan.” How well did that turn out?

So is Janet Yellen the only possible candidate to be the next leader of the Fed? Of course not. But the case for someone else should be made on the merits — and, so far, that hasn’t been what’s happening.

AMERICAN UNEMPLOYMENT HOLDS STEADY. AND THAT'S THE GOOD NEWS.

The U.S. economy added just 165,000 jobs in April, which caused the unemployment rate to fall to a 4-year low of 7.5 percent. March's numbers were readjusted, with 50,000 more jobs added than previously reported, meaning that 138,000 jobs were added that month. Economists warned, though, that that doesn’t help improve the sluggish track the economy has been on. The first two months of the year saw an average of 200,000 jobs added, although growth cooled in March.

The American economy continues to add jobs in proportion to population growth. Nothing less, nothing more.
The share of American adults with jobs has barely changed since 2010, hovering between 58.2 percent and 58.7 percent. This employment-to-population ratio stood at 58.6 percent in April. That is about four percentage points lower than the employment rate before the recession, a difference of roughly 10 million jobs. In other words, the United States economy is not getting any closer to recreating the jobs lost during the recession.

Housing Starts Surge, Construction Jobs Don't

While the number of housing starts has surged – nearly doubling in the last two years – employment in residential construction has barely budged. And construction employment tracked down ever so slightly to 5.79 million workers in April, according to the preliminary data.
What gives? Where are the missing construction workers?
Those are questions that economists have been puzzling over for the last year or so, as the housing market has started to normalize, with low inventory and new demand causing prices to rise in markets across the country and builders eagerly breaking ground on new developments from Florida to California.
Over time that should lead to rising employment in the sector, especially given pent-up demand for projects. But not yet. Construction employment is starting to turn up, but from a very low level: There are about as many construction workers now as there were in 1997. And construction employment in the residential sector remains essentially flat, gaining about 2.5 percent in the last year.
There seem to be a few components to the answer. The first is that housing starts tend to tell us where the market for construction workers is going, not where it is right now. So even as starts have surged as builders have begun new projects, the overall number of units under construction remains relatively low – meaning relatively few available jobs




Second, it seems that builders in some markets may be having trouble recruiting skilled workers, as [NYT reporter] Catherine Rampell recently reported. That has not yet led to much of a surge in compensation in the sector, as you might expect. But perhaps the businesses are paying workers under the table, or making do with fewer of them, in part by increasing their hours.
Moreover, builders will eventually need to hire employees to work on new projects. (As far as I know, there have not been any great productivity advances in home building in the past few years, and nobody’s outsourcing the work to robots.)

The Young Suffer The Most...

NY TIMES

THE idle young European, stranded without work by the Continent’s dysfunction, is one of the global economy’s stock characters. Yet it might be time to add another, even more common protagonist: the idle young American.

For all of Europe’s troubles — a left-right combination of sclerotic labor markets and austerity — the United States has quietly surpassed much of Europe in the percentage of young adults without jobs. It’s not just Europe, either. Over the last 12 years, the United States has gone from having the highest share of employed 25- to 34-year-olds among large, wealthy economies to having among the lowest.

 

 

 

The grim shift — “a historic turnaround,” says Robert A. Moffitt, a Johns Hopkins University economist — stems from two underappreciated aspects of our long economic slump. First, it has exacted the harshest toll on the young — even harsher than on people in their 50s and 60s, who have also suffered. And while the American economy has come back more robustly than some of its global rivals in terms of overall production, the recovery has been strangely light on new jobs, even after Friday’s better-than-expected unemployment report. American companies are doing more with less.

 

Employers are particularly reluctant to add new workers — and have been for much of the last 12 years. Layoffs have been subdued, with the exception of the worst months of the financial crisis, but so has the creation of jobs, and no one depends on new jobs as much as younger workers do. For them, the Great Recession grinds on.

For many people with jobs and nest eggs, the economy is finally moving in the right direction, albeit a long way from booming. Average wages are no longer trailing inflation. Stocks have soared since their 2009 nadir, and home prices are increasing again. But little of that helps younger adults trying to get a foothold in the economy. Many of them are on the outside of the recovery looking in.

 

....Except for College Grads

 

 

The official unemployment rate for 25- to 34-year-old college graduates remains just 3.3 percent.

 

Among all segments of workers sorted by educational attainment, college graduates are the only group that has more people employed today than when the recession started.

The number of college-educated workers with jobs has risen by 9.1 percent since the beginning of the recession. Those with a high school diploma and no further education are practically a mirror image, with employment down 9 percent on net. For workers without even a high school diploma, employment levels have fallen 14.1 percent.

But just because college graduates have jobs does not mean they all have “good” jobs.

There is ample evidence that employers are hiring college-educated workers for jobs that do not actually require college-level skills — positions like receptionists, file clerks, waitresses, car rental agents and so on.

 

Megan Parker, right, a law firm receptionist, and Laura Burnett, a paralegal, are college graduates, as are all their co-workers

 

 

In other words, workers with four-year degrees have gobbled up all of the net job gains. In fact, there are more employed college graduates today than employed high school graduates and high school dropouts put together.

It is worth noting, too, that even young college graduates are finding jobs, based on the most recent data on this subgroup. In 2011, the unemployment rate for people in their 20s with at least a bachelor’s degree was 5.7 percent. For those with only a high school diploma or a G.E.D., it was nearly three times as high, at 16.2 percent.

Americans have gotten the message that college pays off in the job market. College degrees are much more common today than they were in the past. In April, about 32 percent of the civilian, noninstitutional population over 25...had a college degree.

Twenty years ago, the share was 22 percent.

 

These forces might help explain why there is so much growth in employment among college graduates despite the fact that the bulk of the jobs created in the last few years have been low-wage and low-skilled, according to a report last August from the National Employment Law Project, a liberal research and advocacy group. Today nearly one in 13 jobs is in food services, for example, a record share.

 

      

Clearly, positions in retail and food services are not the best use of the hard-earned skills of college-educated workers, who have gone to great expense to obtain their sheepskins. Student loan borrowers graduate with an average debt of $27,000, a total that is likely to grow in the future.

 

The median weekly earnings of college-educated, full-time workers — like those for their counterparts with less education — have dipped in recent years. In 2012, the weekly median was $1,141, compared with $1,163 in 2007, after adjusting for inflation. The premium they earn for having that college degree is still high, though.

 

In 2012, the typical full-time worker with a bachelor’s degree earned 79 percent more than a similar full-time worker with no more than a high school diploma. For comparison, 20 years earlier the premium was 73 percent, and 30 years earlier it was 48 percent.

 

So, despite the painful upfront cost, the return on investment on a college degree remains high. An analysis from the Hamilton Project at the Brookings Institution in Washington estimated that the benefits of a four-year college degree were equivalent to an investment that returns 15.2 percent a year, even after factoring in the earnings students forgo while in school.

“This is more than double the average return to stock market investments since 1950,” the report said, “and more than five times the returns to corporate bonds, gold, long-term government bonds, or homeownership.”

The Market Speaks! Unemployment at 4-Year-Low as U.S. Hiring Gains Steam

Bolstered by a healthier private sector, the United States economy gained 236,000 jobs in February, well above what had been expected, while the unemployment rate fell to 7.7 percent, its lowest level since December 2008.

The gains were broad-based, the Labor Department said Friday, with sectors ranging from manufacturing to business services turning in healthy results. Construction was especially strong, adding 48,000 jobs, a sign that the recovery in the housing market is beginning to translate into new jobs.

Public-sector employment continued to shrink, however, as the number of government employees nationwide fell by 10,000.

While many economists were encouraged by the report, some noted that the size of the labor force contracted by 130,000. Some of that was because of retirements, but some was also a result of discouraged workers giving up the search for jobs.

 

However, economists expect the budget cuts now under way in Washington to contribute significant headwinds in the months ahead. The so-called sequester went into effect March 1.

 

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JACK KRUGMAN

 THE MARKET SPEAKS!

 

Four years ago, as a newly elected president began his efforts to rescue the economy and strengthen the social safety net, conservative economic pundits — people who claimed to understand markets and know how to satisfy them — warned of imminent financial disaster. Stocks, they declared, would plunge, while interest rates would soar.   

 

 Even a casual trawl through the headlines of the time turns up one dire pronouncement after another. “Obama’s radicalism is killing the Dow,” warned an op-ed article by Michael Boskin, an economic adviser to both Presidents Bush. “The disciplinarians of U.S. policy makers return,” declared The Wall Street Journal, warning that the “bond vigilantes” would soon push Treasury yields to destructive heights.

Sure enough, this week the Dow Jones industrial average has been hitting all-time highs, while the current yield on 10-year U.S. government bonds is roughly half what it was when The Journal published that screed.

O.K., everyone makes a bad prediction now and then. But these predictions have special significance, and not just because the people who made them have had such a remarkable track record of error these past several years. 

 

   No, the important point about these particular bad predictions is that they came from people who constantly invoke the potential wrath of the markets as a reason we must follow their policy advice. Don’t try to cover America’s uninsured, they told us; if you do, you will undermine business confidence and the stock market will tank. Don’t try to reform Wall Street, or even criticize its abuses; you’ll hurt the plutocrats’ feelings, and that will lead to plunging markets. Don’t try to fight unemployment with higher government spending; if you do, interest rates will skyrocket.

And, of course, do slash Social Security, Medicare and Medicaid right away, or the markets will punish you for your presumption.

By the way, I’m not just talking about the hard right; a fair number of self-proclaimed centrists play the same game. For example, two years ago, Erskine Bowles and Alan Simpson warned us to expect an attack of the bond vigilantes within, um, two years unless we adopted, you guessed it, Simpson-Bowles. 

 

 So what the bad predictions tell us is that we are, in effect, dealing with priests who demand human sacrifices to appease their angry gods — but who actually have no insight whatsoever into what those gods actually want, and are simply projecting their own preferences onto the alleged mind of the market.

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What, then, are the markets actually telling us?

 

The interest-rate story is fairly simple. As some of us have been trying to explain for four years and more, the financial crisis and the bursting of the housing bubble created a situation in which almost all of the economy’s major players are simultaneously trying to pay down debt by spending less than their income....to put it loosely,...right now everyone wants to save and nobody wants to invest. So we’re awash in desired savings with no place to go, and those excess savings are driving down borrowing costs.

 Under these conditions, of course, the government should ignore its short-run deficit and ramp up spending to support the economy. Unfortunately, policy makers have been intimidated by those false priests, who have convinced them that they must pursue austerity or face the wrath of the invisible market gods.

 

Meanwhile, about the stock market: Stocks are high, in part, because bond yields are so low, and investors have to put their money somewhere. It’s also true, however, that while the economy remains deeply depressed, corporate profits have staged a strong recovery....hundreds of billions of dollars are piling up in the treasuries of corporations that, facing weak consumer demand, see no reason to put those dollars to work.

 

So the message from the markets is by no means a happy one. What the markets are clearly saying, however, is that the fears and prejudices that have dominated Washington discussion for years are entirely misguided. And they’re also telling us that the people who have been feeding those fears and peddling those prejudices don’t have a clue about how the economy actually works.

 

 

Dow Closes Over 14000, jobless rate Up Slightly to 7.9%

Job applicants at a job fair at Marlins Park in Miami last month.

Huzzah! That was the rallying cry on the floor of the New York Stock Exchange as the Dow Jones Industrial Average closed Friday above 14,000 for the first time in more than five years. Overall, the Dow was up one percent in morning trading while the S&P 500 Index rose 0.9 percent. U.S. hiring in January increased more than previously expected, with the economy adding 157,000 jobs, although the jobless rate slightly ticked up on Friday to 7.9 percent.

The economy added just 157,000 jobs in January, slightly less than had been estimated. The report comes just days after data Wednesday showed that the economy actually shrunk in the last quarter of 2012,

Unemployment Rate Holds Steady

Librado Romero/The New York Times

Gina and Stephen Shadis were laid off within the last 14 months from jobs they had held for more than a decade. They are now each receiving $548 per week in federal jobless benefits.

The U.S. economy added 155,000 jobs in December, keeping the unemployment rate steady at just below 8 percent, according to Friday's job report by the Bureau of Labor Statistics. Despite keeping the unemployment rate at its lowest levels since 2008, economists warned that future job growth is unlikely, as they wait for the effects of superstorm Sandy to hit the economy—and also the effect of the Jan. 1 tax hikes. November's job numbers were revised upward slighty from an initial reporting of 7.7 percent unemployment rate.

Read it at Bureau of Labor Statistics

January 4, 2013 8:31 AM

UNEMPLOYMENT RATE DIPS BELOW 8%

The nation’s unemployment rate dropped below 8 percent in September to its lowest rate since the month President Obama took office, the Labor Department said Friday.

While employers added only a modest 114,000 jobs last month, the jobless rate declined to 7.8 percent from 8.1 percent, even though more people entered the labor force.

Adding to the positive news, job gains were revised upward by 40,000 for July (to 181,000) and by 46,000 for August (to 142,000), which had been considered a disappointing month, casting a slightly rosier hue on the summer slowdown.

The private sector, which has been adding jobs since March 2010, grew by 104,000 workers in September. Governments, where cuts have been a drag on the recovery, added 10,000 jobs.

Manufacturing, one of the bright spots that Mr. Obama has showcased throughout the re-election campaign, fell 16,000 jobs after losing a revised 22,000 in August, and construction jobs grew by 5,000. The number of temporary jobs, usually considered a harbinger of future growth, fell 2,000.

Coming a month before the presidential election, the lower jobless rate was a clear gain for the incumbent