Unemployment may have dropped below 10% last month, but the number only looks good in a vacuum. The Bureau of Labor Statistics, the bearer of much of the federal government’s bad news over the last two years, said that the number of jobs open in America dropped to 2.5 million in December. That was a sharp decline from 3.2 million in the same month of 2008.
The BLS reported that “Over the 12 months ending in December, hires totaled 49.4 million and
separations totaled 53.6 million, yielding a net employment loss of 4.2 million.”
The most extraordinary statistic in the “Job Openings and Labor Turnover” report was that there were 6.1 unemployed workers for every job opening in December. That figure was up from 3.4 in the same month of 2008.
The figures are another piece of evidence of how intractable the unemployment problem is. Companies continue to layoff workers, but the hiring that usually comes as a recession ends has not begun, nor is it likely to for some time. The Congressional Budget Office expects the jobless rate to be above 10% between now and mid-year.
Productivity rose 6.2% in the fourth quarter and 7.2% in the third as companies squeezed more and more work out of every employee in the contracting work force. Many economists believe that improved GDP means firms will have to begin to hire again to handle an increase in sales and revenue. That theory is not being supported by the reality of the BLS numbers. Unemployment isn’t coming down.
Douglas A. McIntyre
Top Gaining Stocks
Top Losing Stocks