Jobs Report Fail

[TitanTiger 20,708]

Can any of the Obama supporters here seriously defend his results (minus the cherry picked charts from his campaign sites)? Would you accept the same explanations/excuses four years later from a Republican president that you're accepting from Obama?

Jobs Report Fail

Via Meadia

Walter Russell Mead's Blog

July 6, 2012

Can we all just admit this now, forty months into the Obama administration? Our economic policy mix isn’t working. Today’s job numbers for June just underline the bitter truth. We’ve spent more money and printed more money in the last 40 months than in any comparable period in American history, and what we’ve got to show for it is a flabby, out of shape recovery that the IMF warns could be heading for a new recession.

There are those who say we need to print much more and spend much more to get the economy going again, and those who say that doing that will just get us deeper in the hole with nothing more to show for it. The likely result of this impasse is that we won’t do what anybody recommends, but bumble along instead halfway between the two extremes, hoping something turns up. And if we’re lucky, which I think we probably will be, the politicians won’t do the equivalent of pouring sugar in the gas tank by failing to resolve the budget and tax crunch coming at the end of the year. That’s not a solution; it just means we won’t deliberately drive our car into the ditch.

The Europeans, the Chinese, the Japanese and the Indians also look pretty stuck. None of them really seem to have clear solutions for the problems they face, and even if a clear solution emerged, it’s hard to see them summoning up the political will for big change.

A couple of quick observations, not to be mistaken for stock tips about all this:

• The world’s economy and its financial system have become more complicated than our economists, our politicians and even our businessmen understand. Economic theory is not an abstract, theoretical science. It is an empirical one; what we know about economic policy is the result of centuries of trial and error experiment. The world economy has climbed a wall of failure for hundreds of years: each breakdown, each impasse forces us to come to grips with a new and more complicated set of dynamics. That’s what’s happening now.
  
• This time it’s going to be harder than usual to figure things out. Too many dynamics have changed. IT is transforming both financial markets and the real economy. The rise of new economic powers with different agendas is changing the way the world works — think about the impact of those huge savings pools in Asia and the Gulf. The pace of change has accelerated, and that means the economy is changing faster and economic policy ideas are becoming outmoded faster than ever. Get used to it.
  
• The world’s political institutions are as challenged as our economic policy ideas and tools. The Europeans haven’t figured out how to govern themselves and show no signs of resolving their problems anytime soon. India’s political impasse looks to be getting deeper. China has not yet figured out how to reform its system without a general meltdown and each year the social and political stress becomes greater and harder to manage. The US has the best constitution and political culture of the lot, but this, clearly, is not our finest hour. No political system can work very well when nobody really knows what to do.
  

In American politics, we seem to be back to 2004. We have a president who doesn’t, on the basis of performance, deserve re-election, and a challenger who hasn’t yet demonstrated that he would be better. Senator Kerry never managed to change that; in the end Americans in 2004, ready as they were to dump President Bush, decided that the incumbent was the lesser of two evils. Governor Romney, so far, hasn’t done much better than Kerry. He still has time to change that dynamic, but if he doesn’t, this really will be 2004 all over again, and the public will decide between two candidates that a majority would prefer weren’t in the race at all.

Economies do tend to turn around at some point. People all over the world want to make money, and in spite of all the obstacles in their path, they will keep hustling and bustling until something works. Among other things, this particular economic patch is bad because between 1984 and 2007 this country had one of its longest periods of prosperity ever with only a couple of short blips of turbulence. After a smoother than average ride for 23 years, it isn’t, from a historical point of view, all that surprising that things have slowed down.

Nevertheless, the whole world today is watching the very public failure of its economic and political leadership. The longer this continues, the more people around the world will turn to new and non-mainstream ideas. Some of them may turn out to be exactly the kind of brilliant and innovative new ideas that can make life much better; some will certainly be old, bad ideas that bring ruin and blood.

Let’s hope for better news from the jobs report next month.

http://blogs.the-american-interest.com/wrm/2012/07/06/jobs-report-fail/

[Tigermike 3,425]

Another Month of Data Re-Confirms Obama’s Horrible Record on Jobs

July 6, 2012 by Dan Mitchell

Remember back in 2009, when President Obama and his team told us that we needed to squander $800 billion on a so-called stimulus package.

The crowd in Washington was quite confident that Keynesian spending was going to save the day, even though similar efforts had failed for Hoover and Roosevelt in the 1930s, for Japan in the 1990s, and for Bush in 2008.

Nonetheless, we were assured that Obama’s stimulus was needed to keep unemployment from rising above 8 percent.

Well, that claim turned out to be quite hollow. Not that we needed additional evidence, but the new numbers from the Labor Department re-confirm that the White House prediction was wildly inaccurate. The 8.2 percent unemployment rate is 2.5 percentage points above the Administration’s prediction.

Defenders of the Obama Administration sometimes respond by saying that the downturn was more serious than anyone predicted. That’s a legitimate assertion, so I don’t put too much blame the White House for the initial spike in joblessness.

But I do blame them for the fact that the labor market has remained weak for a lengthy period. This chart, which I just generated this morning on the Minneapolis Fed’s interactive website, shows employment data for all the post-World War II recessions.

The current business cycle is the red line. As you can see, some recessions were deeper in the beginning and some were more mild. But the one thing that is unambiguous is that we’ve never had a jobs recovery as anemic as the one we’re experiencing today.

Job creation has been extraordinarily weak. Indeed, the 8.2 percent unemployment rate actually masks the bad news since it doesn’t capture all the people who have given up and dropped out of the labor force.

By the way, I don’t think the so-called stimulus is the main cause of today’s poor employment data. The vast majority of that money was pissed away in 2009, 2010, and 2011.

Today’s weak job market is affected by things such as the threat of higher taxes in 2013 (when the 2001 and 2003 tax cuts are scheduled to expire), the costly impact of Obamacare, and the harsh regulatory environment. This cartoon shows, in an amusing fashion, the impact of these policies on entrepreneurs and investors.

P.S. Click on this link if you want to compare Obamanomics and Reaganomics. The difference is astounding.

P.P.S. Obama will probably continue to blame “headwinds” for the dismal job numbers, so this cartoon is definitely worth sharing.

http://danieljmitchell.wordpress.com/2012/07/06/another-month-of-data-re-confirms-obamas-horrible-record-on-jobs/

[Tigermike 3,425]

June jobs swoon: America’s labor market depression continues

James Pethokoukis |

July 6, 2012, 9:31 am

This was not the employment report either the American worker or the Obama campaign wanted to see right now. The Labor Department said the U.S. economy created just 80,000 jobs in June, less than the 90,000 economists had been forecasting. And private-sector job growth was just 84,000, down sharply from 105,000 in May. Not doing fine.

The unemployment rate stayed at a lofty 8.2%.

As a research note from RDQ economics put it: “The good news is that employment growth is not slowing further but there is no sign of it picking up either. At this pace, job creation is not fast enough to lower the unemployment rate with the labor force growing at close to 150,000 per month on average.” Shorter: Stagnation Nation

This continues to be the longest streak — 41 months — of unemployment of 8% or higher since the Great Depression. And recall that back in 2009, Team Obama predicted that if Congress passed its $800 billion stimulus plan, the unemployment rate would be around 5.6% today.

Just 75,000 jobs were created, on average, per month in the second quarter vs. 226,000 in the first quarter. And for the year, monthly job creation has averaged just 150,000 vs. 153,000 last year. Both numbers are extremely weak.

But those top-line numbers actually overstate the health of the labor market.

– If the size of the U.S. labor force as a share of the total population was the same as it was when Barack Obama took office—65.7% then vs. 63.8% today—the U-3 unemployment rate would be 10.9%. Even if you take into account that the LFP should be declining as America ages, the unemployment rate would be 10.5%.

– The broader U-6 unemployment rate, which includes “all persons marginally attached to the labor force, plus total employed part time for economic reasons,” is 14.9%, up a bit from May.

– The average duration of unemployment ticked up to 39.9 weeks.

– It will take 219,000 net new jobs a month for unemployment rate to be below 8% on Election Day if current participation rate holds steady.

– Job growth during the three-year Obama recovery has averaged just 75,000 a month for a total of 2.7 million. During the first three years of the Reagan Recovery, job growth averaged 273,000 a month for a total of 9.8 million. If you adjust for the larger U.S. population today, the Reagan Recovery averaged 360,000 jobs a month for a three-year total of 13 million jobs.

– The U.S. work force remains shrunken with just 58.6% employed:

None of this should be surprising. The economy grew a bit less than 2% last year, and we averaged about 150,000 new jobs a month. We are growing a bit less than 2% this year, and job growth is averaging about 150,000 jobs a month. And there are few signs the rest of the year will be any better. And given a) how the eurocrisis is AGAIN flaring up, and China continues to slow, it sure seems like 2% growth and 8% unemployment is a best-case scenario with plenty of downside risk — for the economy and the Obama campaign.

James Pethokoukis is a columnist and blogger at the American Enterprise Institute. Previously, he was the Washington columnist for Reuters Breakingviews, the opinion and commentary wing of Thomson Reuters.

Pethokoukis was the business editor and economics columnist for U.S. News & World Report from 1997 to 2008. He has written for many publications, including The New York Times, The Weekly Standard, Commentary, National Review, The Washington Examiner, USA Today and Investor’s Business Daily.

Pethokoukis is an official CNBC contributor. In addition, he has appeared numerous times on MSNBC, Fox News Channel, Fox Business Network, The McLaughlin Group, CNN and Nightly Business Report on PBS. A graduate of Northwestern University and the Medill School of Journalism, Pethokoukis is a 2002 Jeopardy! Champion.

http://www.aei-ideas.org/2012/07/june-jobs-swoon-americas-labor-market-depression-continues/

[Tigermike 3,425]

10 reasons why jobs market even worse than weak June employment report

1 Comment

By ED CARSON

Posted 08:51 AM ET

Nonfarm payrolls rose by just 80,000 in June, slightly worse than expected and the third straight month of sub-100,000 job growth. The jobless rate held at 8.2%. The employment report was disappointing. Here are 10 reasons why the jobs market is even worse than the headline figures.

1. Unemployment has topped 8% for 41 straight months. Last time above 8% - December 1983.

2. The jobless rate actually makes the labor market look better than it actually is. The rate only counts people who want a job but don't have one. But the labor force participation rate was 63.8% in June, just above near modern-era lows. (It was 66.2% in January 2008 and 67.3% in April 2000). Otherwise, unemployment would be around 11%.

3. The employment-to-population ratio for those aged 25-54 dipped to 75.6% in June, down sharply from 80% in January 2008. Many economists left and right view the core employment ratio as one of the cleanest views of the labor market, because it includes those who have stopped looking for work while excluding the bulge in retirees and young adults in school.

4. Chronic unemployment. The average length of unemployment rose to 39.9 weeks in June, close to recent peak. It was 17.4 weeks at the January 2008 peak and 23.9 weeks in June 2009, when the recession officially ended. Long-term joblessness is particularly bad because skills erode or become obsolete, leading to permanent losses in income.

5. The U.S. added 225,000 jobs in the second quarter vs. 677,000 in Q1. That was the smallest quarterly gain since Q1 2010 — excluding the Q3 2010 post-Census decline. June's gain of 80,000 is not enough to absorb new workers to prevent the unemployment rate from rising over the long term.

6. Nonfarm payrolls are 4.935 million, or 3.6%, below their January 2008 peak.

7. This is already the longest jobs recession since the Great Depression at 53 months. Payrolls aren't on track to reach the old highs until June 2015, assuming the sluggish economic expansion lasts that long.

8. Private sector "doing fine"? Private-sector employment still down 3.9%, or 4.502 million. Government jobs overall are down 1.9%, with federal jobs (ex post office) up 10.7%.

9. Entrepreneurial activity fading. The number of startup firms has crashed from pre-recession highs, still near levels previously seen in the early 1980s, when the number of establishments was far lower. Establishments less than a year old, including those belonging to the same firm, totaled 556,553 in 2010, according to the latest Commerce Department data. That's down 26% from the peak of 747,278 in 2006. Meanwhile, the number of employees at startups has plunged, with a greater share of new firms with no employees — one-man shops. Very small startups are less likely to invest or to grow, a bad sign for future hiring.

10. Gross hiring. The monthly payrolls report refers to net job gains — hiring minus the number of people who were laid off or quit. Layoffs are near decade lows. Actual gross hiring fell to 4.175 million in April, the most recent month in Labor's JOLTS survey. That's the lowest since last July. Weak gross hiring reflects companies remaining cautious. It also makes it harder for the unemployed to find work, which is probably one reason why unemployment duration is so high.

http://news.investors.com/article/617140/201207060851/10-reasons-jobs-market-worse-than-june-report.htm?p=full

[japantiger 4,077]

Obama has downsized America...he holds the record for layoffs.

[tiger88 934]

Maybe, just maybe, if he had someone in his admin with even a tiny bit of real world experience creating jobs they might be doing better???????????????????

[TexasTiger 13,556]

You guys are bright enough to look at the numbers. Obama came in and the jobs had been just falling right off a cliff, and they kept falling for months. And then we turned around and we're coming back and that's progress. And if you are going to suggest that somehow the day Obama got elected, somehow jobs should have immediately turned around, well that would be silly. It takes awhile to get things turned around. We were in a recession; we were losing jobs every month. We've turned around and since the turnaround we've added millions of jobs. That's progress. … A lot of it is outside of Obama's control, it's state government, it's international, it's private sector.

[Tigermike 3,425]

You guys are bright enough to look at the numbers. Obama came in and the jobs had been just falling right off a cliff, and they kept falling for months. And then we turned around and we're coming back and that's progress. And if you are going to suggest that somehow the day Obama got elected, somehow jobs should have immediately turned around, well that would be silly. It takes awhile to get things turned around. We were in a recession; we were losing jobs every month. We've turned around and since the turnaround we've added millions of jobs. That's progress. … A lot of it is outside of Obama's control, it's state government, it's international, it's private sector.

But according to Obama and you guys it was all within Bush's control and it's still his fault it hasn't got better.

And you are bright enough to know there has been no turn around. Dismal is the word that comes to mind.

From an e-mail:

Here are today’s statistics on the state of the economy:

The Monster Employment Index rose 6 points to 153, as online recruiting picked up in June.

The Employment Situation for June is dismal for the 3rd month in a row. Total non-farm payrolls increased by 80,000. The unemployment rate is unchanged at 8.2%. Hourly earnings increased by 0.3%, while Weekly hours increased by 0.1 hours to 34.5 hours. Private payrolls increased by 84,000. The U-6 unemployment rate, the broadest measure of unemployment/underemployment, rose 0.1% to 14.9%. The labor force participation rate and the employment/population ratio are both unchanged at 63.8% and 58.6%, respectively. Both are the lowest since 1983.

Tex, if that's a turnaround and if that's what you call looking up, you really need to get new glasses.

[tiger88 934]

Tex is delusional. Were talking Jim Jones delusional, lol.

[BamaGrad03 0]

You guys are bright enough to look at the numbers. Obama came in and the jobs had been just falling right off a cliff, and they kept falling for months. And then we turned around and we're coming back and that's progress. And if you are going to suggest that somehow the day Obama got elected, somehow jobs should have immediately turned around, well that would be silly. It takes awhile to get things turned around. We were in a recession; we were losing jobs every month. We've turned around and since the turnaround we've added millions of jobs. That's progress. … A lot of it is outside of Obama's control, it's state government, it's international, it's private sector.

But none of the current jobs numbers are congruous with the expectations Obama set in his campaign. That was from the man himself. Not republicans.

[Grumps 3,706]

I agree with Tex...it's all still Bush's fault and will be Bush's fault until another republican gets into the White House and then it will be his/her fault unless the news is good, in which case it will be due to the success of the Obama Administration.

[japantiger 4,077]

I agree with Tex...it's all still Bush's fault and will be Bush's fault until another republican gets into the White House and then it will be his/her fault unless the news is good, in which case it will be due to the success of the Obama Administration.

I read a great example of Obama's approach to blaming Bush for everything bad and taking credit for all good.

"A relief pitcher comes in in the 5th and the team is 3 runs behind. He gets the side out 3 up, 3 down. His team scores 3 runs...now going into the 6th, they are tied. In the top of the 6th, he gives up 5 runs....now they are down by 5; and they lose...the relief pitcher is credited with the loss.. After the game, they ask the pitcher why he did so poorly in the 6th and gave up 5 runs...he answers, it's because we were behind when I came into the game".

[Tigermike 3,425]

Flashback: In 2004, Obama dismissed creation of 310,000 jobs under Bush

http://twitchy.com/2012/07/06/flashback-in-2004-obama-dismissed-creation-of-310000-jobs-under-bush/

Out of touch: Obama: Jobs report ‘step in right direction,’ ‘don’t read too much into it’; Mockery ensues

http://twitchy.com/2012/07/06/out-of-touch-obama-jobs-report-step-in-right-direction-dont-read-too-much-into-it-mockery-ensues/

The Leitmotif of the Obama Era: ‘Less Than Expected’

July 6, 2012 - 12:32 pm - by Ed Driscoll

Page 1 of

The above cartoon is by the great Michael Ramirez of Investor’s Business Daily.

From the summer of 2010.

It reflects, as a recent article at Reason notes, “42 Straight Months of Stupidly Optimistic Official Predictions About Economic Recovery.” Bringing us up to today’s job report which Bloomberg News — as is their wont – describes as “Less Than Expected” in their headline:

American employers added fewer workers to payrolls than forecast in June and the jobless rate stayed at 8.2 percent as the economic outlook dimmed.

The 80,000 gain in employment followed a 77,000 increase in May, Labor Department figures showed today in Washington. Economists projected a 100,000 rise, according to the median estimate in a Bloomberg News survey. Growth in private payrolls was the weakest in 10 months.

Stocks fell on concern hiring has shifted into a lower gear, restricting consumer spending and leaving the economy more vulnerable to a global slowdown. The figures underscore concern among some Federal Reserve policy makers that growth isn’t fast enough to lower unemployment stuck above 8 percent since February 2009.

The headline that Bloomberg uses today is “U.S. Payrolls in June Rise Less Than Expected.”

The headline that Bloomberg used on June 8th of last year was “U.S. Payrolls Grow at Slowest Pace in 9 Months.”

For that article, the “unexpectedly” came in the lede, not the headline, but it was there as well:

American employers added jobs at the slowest pace in nine months in June and the unemployment rate

unexpectedly

climbed to 9.2 percent, sending global stocks sliding on concern the world’s biggest economy is faltering.

Beyond the virulent case of amnesia that’s spread through newsrooms throughout America, there’s also the cognitive dissonance of defending a president who wants to have his hand in every facet of the economy in mid 20th century Soviet John Kenneth Galbraith-style, and yet must now be described by the MSM as concurrently too weak to do anything about the same economy he desires complete control over. This strain of Orwellian doublethink can be explained as the Obamamedia doing what it can to calm voters’ fears (and their own), because as Jonathan S. Tobin of Commentary wrote yesterday in anticipation of today’s grim employment report, “It’s Getting Late Early for Obama’s Economy:”

The numbers matter because they are the tangible measure of the success of failure of any administration in proving the country is in better shape than it was when they took over the big fancy offices in Washington after the last presidential election. If voters take these numbers seriously it’s because that along with personal experiences they help form the voters’ overall impression of the state of the economy. The key here is not so much the details of each report as it is the trajectory of the nation’s finances. Moreover, given the fact that we are just four months away from the November election, it’s that point in time when, in the immortal words of Yogi Berra, politicians begin to understand that “it gets late early out there.” Once the electorate accepts the verdict that the economy is either on the decline or on the rise, a possible change in the fall (with the exception perhaps of a collapse on Wall Street such as occurred in September 2008) is unlikely.

Which is why, right on cue with today’s poor jobs report, the presidential palace guard in the MSM goes on the air and cranks out articles suggesting, as one Oba-booster at ABC does, that no modern president “can do much to change the situation.”

Barack Obama — or at least his speechwriters — once thought differently, as we’ll explore on the next page.

In 2004, the unemployment rate averaged out at 5.5 percent. In June of that election year, Obama, running for the US Senate that year (where he would would later stop in for a cup of coffee on the way to his now fateful presidential bid) attacked President Bush over his job record. As Drew at Ace of Spades’ blog writes, let’s compare how the two presidents stand up at identical points during their tenures in office:

How many jobs did the economy created in June of 2004?

112,000

(pdf). This was actually down from previous months. It’s actually impressive considering the unemployment rate was…5.6% and had been for much of that year (it’s harder to get big job growth when unemployment is relatively low).

Obama actually said

that today’s awful job numbers are “a step in the right direction”.

So to recap…112,000 jobs and 5.6% unemployment was killing the middle class but 80,000 jobs (when there’s clearly a job shortage) and 8.2% unemployment is “a step in the right direction”.

Buzzfeed has the audio; the transcript of Obama’s speech reflects this classic “we can do better” moment:

America needs a strong, vibrant middle class. And until middle class families get their heads above water, we can’t declare victory.

The President attacks those who make this point as “pessimists.”

He apparently believes that this is the best we can do.

We believe that we can do better.

As the folks at Twitchy.com quip in response today, “5.6% unemployment was attacked as weak. What, pray tell, is 8.2% unemployment, then? Answer: ‘Shut up, racists.’”

Obama has had his chance to put his sclerotic early 20th century theories to the test, and the result was identical to the 1930s. Other than the ability to spend the taxpayers’ money like there’s no tomorrow (which Greece, Detroit, and several California towns can tell you is true — there is no tomorrow), the entire Obama administration’s performance has been “less than expected.” Except perhaps by those of us who weren’t expecting much all along.

Which means that for the nation to have any hope, it’s now time for a change.

In other words, “It doesn’t have to be this way,” at Mitt Romney said today in response to the president’s “less than expected” employment numbers.

Update: As James Pethokoukis of the American Enterprise Institute notes in a killer chart atop a Drudge-linked article today, in 2009, the Obama administration predicted that unemployment would be at 5.6 percent today as a result of his economic “stimulus” program, passed that year at the height of hopenchange, when Democrats controlled all branches of the Federal Government, and as Newsweek boasted at the time, “We Are All Socialists Now:”

More: If “unexpectedly” is the verbal tic that defines the media’s self-imposed amnesia, then cutting and pasting the phrase “Therefore, it is important not to read too much into any one monthly report and it is informative to consider each report in the context of other data that are becoming available” at the end of economic reports from the Obama White House’s Website every month since January is the administration’s equivalent.

http://pjmedia.com/eddriscoll/2012/07/06/less-than-expected/

[Auburn85 434]

The only difference between Stockton, California, Birmingham, Alabama and the U.S. government is the Federal Reserve.

States can't run record deficits. States would not be able to raise taxes enough to offset the record deficits. States have also been suffering from the consequences of inflated property tax revenues because of the housing bubble.

Then, on top of all of that, they now have to deal with expanding Medicaid.

The stimulus gave states money to patch their deficits for a couple of years.

Obamacare did the same thing- Gave states money for Medicaid for a couple of years. Now, the states will have to fend for themselves to fund extra Medicaid cost, unless Congress or Obama come to the rescue.

[TexasTiger 13,556]

Tex is delusional. Were talking Jim Jones delusional, lol.

Actually, I was mostly quoting Romney from 2006 (the last year of his term) when he was defending his measly job creation record during far better times than we've been in the for the last 4 years. I substituted "Obama" for references to Romney, "millions" for the 50,000 jobs he claimed responsibility for. Listen for yourself.

The sad thing is that you are going to vote for someone you would see as delusional if they had a "D" by his name.

[rolltide316 0]

Who would have thought in the late 90s, we would be going through this? The 9/11 attacks seriously changed things for the worse....did we overcome? It led to two major wars and a large period of time where we did not keep politicians accountable because we were protecting America.

[tiger88 934]

Tex is delusional. Were talking Jim Jones delusional, lol.

Actually, I was mostly quoting Romney from 2006 (the last year of his term) when he was defending his measly job creation record during far better times than we've been in the for the last 4 years. I substituted "Obama" for references to Romney, "millions" for the 50,000 jobs he claimed responsibility for. Listen for yourself.

The sad thing is that you are going to vote for someone you would see as delusional if they had a "D" by his name.

Lesser of two evils.

[BamaGrad03 0]

I don't understand why democrats want to bash Romney on his "jobs creation" record when he was in PE. He was in private damn equity. His job was to maximize profits. If that meant cutting jobs, it meant cutting jobs. As if there's never, in the history of the economy, been a need to cut jobs.

Obama's being scruitinzed because his JOB is to create jobs. When Romney has a job, and its sole purpose is to create more jobs, then maybe you can judge him on it.

The guy's business acumen is clearly evident. And much preferred over a guy who only knows how to create jobs by expanding government.