by Bill McBride on 6/04/2010 09:59:00 AM
Friday, June 04, 2010
Here are a few more graphs based on the employment report ...
Percent Job Losses During Recessions, aligned at Bottom
Click on graph for larger image.
This graph shows the job losses from the start of the employment recession, in percentage terms - but this time aligned at the bottom of the recession.
The current recession bounced along the bottom for a few months - so the choice of bottom is a little arbitrary (plus or minus a month or two).
Notice that the 1990 and 2001 recessions were followed by jobless recoveries - and the eventual job recovery was gradual. In earlier recessions the recovery was somewhat similar and a little faster than the decline (somewhat symmetrical).
The dotted line shows the impact of Census hiring. In May, there were 564,000 temporary 2010 Census workers on the payroll. Starting in June, the number of Census workers will decline - and the two red lines will meet later this year.
The Employment-Population ratio decreased to 58.7% in May (from 58.8% in April). This had been increasing after plunging since the start of the recession. This is about the same level as in December 1983.
This graph shows the employment-population ratio; this is the ratio of employed Americans to the adult population.
Note: the graph doesn't start at zero to better show the change.
The Labor Force Participation Rate decreased to 65.0% from 65.2% in April. This is the percentage of the working age population in the labor force. This decline is disappointing, and the rate is well below the 66% to 67% rate that was normal over the last 20 years.
The reason the unemployment rate declined was because people left the workforce - and that is not good news. As the employment picture improves, people will return to the labor force, and that will put upward pressure on the unemployment rate.
Part Time for Economic Reasons
From the BLS report:
The number of persons employed part time for economic reasons (some-times referred to as involuntary part-time workers) declined by 343,000 in May to 8.8 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.The number of workers only able to find part time jobs (or have had their hours cut for economic reasons) was at 8.809 million in April. This decline was a little bit of good news.
The all time record of 9.24 million was set in October.
These workers are included in the alternate measure of labor underutilization (U-6) that was at 16.6% in May.
Unemployed over 26 Weeks
The blue line is the number of workers unemployed for 27 weeks or more. The red line is the same data as a percent of the civilian workforce.
According to the BLS, there are a record 6.763 million workers who have been unemployed for more than 26 weeks (and still want a job). This is a record 4.38% of the civilian workforce. (note: records started in 1948). It does appear the increases are slowing ...
Although the headline number of 431,000 payroll jobs was large, this was only 20,000 after adjusting for the 411,000 Census 2010 temporary hires. The underlying details were mixed. The positives: the unemployment rated decreased to 9.7%, the number of part time workers (for economic reasons) decreased helping to push down U-6 to 16.6% (from 17.1%), hourly wages increased (slightly), as did the average hours worked.
Negatives include the employment-population rate declining, the few payroll jobs ex-Census, and a record number of workers unemployed for more than 26 weeks. The number of long term unemployed is one of the key stories of this recession, especially since many of them are now losing their unemployment benefits.
I'll have even more later ...
Earlier employment post today: