Today was supposed to be all about the employment and jobs data. The data is out and it isn’t pretty. November’s unemployment rate hit a new recent high of 6.7%. The November non-farm payrolls also dropped to atrocious level of -533,000. And as an infomercial would say, "But wait, Bob… It gets worse!"
Expectations were for unemployment to hit 6.8% and for non-farmpayrolls to drop to a level of -350,000. For whatever this is worth,the whisper number was even worse on the non-farm payrolls with somecalling for north of 400,000 to 450,000 jobs lost in the month of November.
But it gets even worse yet… Last month’s non-farm payrolls were also revised to a much worse reading from -240,000 to a revised -320,000 jobs. This looks like we have now lost 1.2 million jobs in just the last 3 months alone. We have now lost about 1.9 million jobs in 2008.
Manufacturing jobslost 85,000 positions and service sector jobs fell by a massive370,000.
Even retail trade fell by -91,000 and temporary work jobsfell by 78,000. Those are truly ominous signs for Q1-2009 readingsafter employers can cut back after the holidays. Santa is giving pinkslips for Christmas this year.
We have been saying for a while that unemployment might get to 7.5% or even above 8% in 2009. Based upon what we are seeing in retail and service sector jobs and what is likely to come in the auto sector, that 8% is looking like a best case scenario.
Main Street and Wall Street have collided now. Just like the womanrealtor from the movie Wall Street said, "Even the rich are bitchin’."
Jon C. Ogg
December 5, 2008
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