This report represents an update of the employment/unemployment data that the government releases at 8:30aET, unusually on the first Friday of the following month, depending on holidays. The original diary, explaining the data, can be found here.
The January employment data continued the labor market disaster. The headline unemployment rate jumped to 7.6%, from 7.2% the month before, the highest rate since mid-1992, and higher than when Clinton took office (7.3%). Payrolls plunged 598,000, and the prior two months were revised downward. Job losses during 2008 are now reported at 3.0 million, worse than the 2.6 million reported just a month ago, already the largest for any year since World War II.
Employment declines of more than half a million per month obviously worsen the outlook for the economy. Cutting interest rates to zero has not stimulated the economy, though the Federal Reserve would point out that the situation would be much worse if they hadn’t eased aggressively. A large fiscal stimulus is needed, yesterday.
The most comprehensive rate for labor underutilization, U-6, is defined as total unemployed, plus all marginally attached workers, plus total employed part-time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers. It leaped to 13.9% in January, up from 13.5% the month before, and 9.0% a year ago. That compares to the headline unemployment rate at 7.6%, up from 4.9% the year before. The January U-6 is the highest on record. (The Bureau of Labor Statistics started reporting this measure in January 1994, when it was 11.8%, whereas most of the other data go back to 1948. See Table 2.)
Here is a bit of analysis of the major employment indicators by presidential term, updated for the January data.
*High for post-WWII period;
Go here, click the box for unemployment rate seasonally adjusted, click retrieve data, set the date from 1948 on and click the graph box to see a chart.
|Start date of data||11.8%||1/94|
Go here, check the box for U-6 seasonally adjusted, click retrieve data, set the date from 1994 on and click the graph box to see a chart.
|Jobs Added||% change||% change, annual rate|
Average Ds 3.5% per year
Average Rs 1.1% per year