Gallup reports that “U.S. job creation continues to steadily abate, reversing the upward trend seen since the start of 2010. The nation’s Job Creation Index score slid to +12 in September, marking the third straight month of decline, but remains up slightly from +9 a year ago.” The number of people who think their employers are hiring also dropped.
Challenger Gray data released early today confirmed the trend. Planned lay0ffs announced in September rose to 115,000. August’s total was only 51,000. The 115,000 figure was the highest since April 2009–near the bottom of the last recession. And, ADP reported the private sector added only 91,000 jobs which may have been swamped by public sector firings
September unemployment data could be the most important of the year. Information that shows very weak jobs numbers or GDP trouble will confirm what many economists already believe: the American economy has not stalled — it has fallen into the second recession in four years.
September data will also confirm a trend that began four months ago. There was some modest job creation in the summer. This was followed by August numbers that showed no job creation at all.
The fourth quarter is the money quarter for the U.S. Retail sales have to be good for the holidays. As is pointed out often, consumer activity is at least two-thirds of GDP and perhaps as much as three-quarters in the final quarter of the year. People out of work, or worried about their jobs, do not shop.
Methodology: For Gallup Daily tracking, Gallup interviews approximately 1,000 national adults, aged 18 and older, each day. The Gallup Job Creation Index results are based on a random sample of approximately 500 current full-time and part-time employees each day.
Douglas A. McIntyre
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