This morning's unemployment report was much better than expected: Only 11,000 jobs lost in November and unemployment rate dropping to 10.0%. Yes, the economy is still losing jobs, but it's very close to turning the corner. The above graph was produced before today's report and shows the weekly initial claims for unemployment. The number is dropping and dropping fast. We're still screwed, but today's news is remarkably good.
If you've been paying attention you may be wondering how did the unemployment rate drop to 10.0% when we're still losing jobs? It's because the overall labor force is still shrinking. <--- that's a polite way of saying that many people have given up looking for work.
The unemployment rate will almost certainly go up in the coming months as the economy improves and people again start looking for work. So that rise in unemployment will be a good sign, not a bad one.
True. The "discouraged workers" and those working less hours than they want mean the unemployment rate is WAY below the real unemployment rate.
ReplyDeleteNow they do surveys to help create the unemployment rate and once some say they are looking again the rate will go up.