Jobs Picture

Our high prison incarceration rates also hide some of the unemployment. Also, as the housing market has declined, many contractors from Mexico have returned to their homes.

http://www.epi.org/printer.cfm?id=3099&content_type=1&nice_name=webfeatures_econindicators_jobspict_20080905

Economic Policy Institute
Payrolls contract for eighth month in a row

by Jared Bernstein and Heidi Shierholz with research assistance from Tobin Marcus

The unemployment rate jumped to 6.1% last month, the highest jobless rate since September 2003, and payrolls fell by 84,000 jobs, the eighth month in row of consecutive declines, according to today’s report from the Bureau of Labor Statistics. In every period since 1948 when payrolls have declined this consistently, the economy has been in an official recession.

Both rising unemployment and declining payrolls show some signs of acceleration. Revisions to June and July subtracted another 58,000 from payrolls, such that over the past three months, the average job loss has been 81,000, compared to 67,000 over the prior three months. Since April, the jobless rate is up by 1.1 percentage points, from 5.0% to 6.1%, the largest four-month jump since 1981. Since unemployment bottomed out in March of last year, over 2 million have joined the jobless rolls.

Since January, payrolls are down by 605,000, and private-sector payrolls are down by 772,000 since November 2007 (their prior peak). Since government employment is less sensitive to the business cycle, often adding jobs while other industries are shedding workers, private-sector losses are more indicative of the extent of weakness in the job market.

Notably, the jump in unemployment occurred exclusively among adults, mostly concentrated among persons 25 years and over (teenage unemployment fell slightly in August). The increases for these adults occurred in every education group. Even college graduates had a more difficult time finding work in August, as their jobless rate rose from 2.4% to 2.7%, the highest college unemployment rate since August 2004. At the other end of the educational spectrum, the jobless rate for adults with less than a high school degree jumped to 9.6%, their highest rate since May 1996.
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Other signs of deepening weakness in the job market include the underemployment rate of 10.7% in August and the decline in the employment rate, from 62.4% to 62.1%. Underemployment includes part-timers who would prefer full-time jobs, and while this group did not grow in August, there are 5.7 million workers in this category, a recessionary level. The decline in the employment rate is a clear recessionary signal as well, and was driven last month by large job losses in the household survey. Taken together, these indicators show that employers are responding to weak consumer demand both by cutting workers and cutting hours.
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Given the weakness in job creation, large numbers of job seekers are stuck in unemployment. The number of those who have been jobless for more than six months increased by over half a million over the last year, including 160,000 from July to August. In August, almost one in five unemployed workers (19.5%) had been unemployed for more than six months, the highest level in over three years.