Let's take a look at the numbers from Friday's jobs report.
The chart reveals the following points. First at the end of last year and the beginning of this year the economy was bleeding jobs. Four months ago the rate of job losses decreased from roughly 610,000 on average to about 225,000 on average. In other words, the pace of job losses is still decreasing which is good. However,
The unemployment rate increase .3% to 9.7%. The unemployment rate comes from the household survey which shows in increase in the civilian labor force of 73,000 and an increase in the number of unemployed of 466,000.
In addition,
The number of discouraged workers (persons not currently looking for work because they believe no jobs are available for them) appears to be topping out, as does
The number of people working part-time for economic reasons. However,
The number of marginally attached workers (individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months) is still increasing.
Now let's break down the length of time people are unemployed.
The number of people who are unemployed for five weeks and less has been decreasing since the beginning of the year.
But the number of people unemployed for 5-14 weeks increased. However,
The number of people unemployed for 15-26 weeks decreased and
The number of people unemployed for 27 weeks and longer increased but at a far slower rate.
Putting all of this together, we get the following picture.
1.) The rate of job destruction has decreased since the beginning of the year. Remember that at the end of last year the beginning of this year, the economy was losing 600,000 jobs per month. To expect that figure to turn around and print a positive number within 6-9 months is highly unrealistic. In fact, it is most possible that we'll see job losses through the next 3-6 months. But the pace of job losses is decreasing which is good news.
2.) The increase in the unemployment rate is bad news, plain and simple.
3.) The steady size of the number of people working part-time for economic reasons along with the possible topping out of discouraged workers is also good news as it indicates a possible topping of two categories of labor under-utilization.
4.) Two of the four time periods of unemployment showed improvement last month and the worst category (people unemployed for 27 weeks and longer) showed a far slower rate of acceleration.
5.) The increase in the marginally attached and the number of people unemployed for 5-14 weeks are bad developments.
Overall, this report showed improvement. The rate of job destruction is increasing, the number of people working part-time for economic reasons and discouraged workers appears to be topping, and the number people unemployed for two time periods decreased while the worst category showed a far slower rate of decrease.