March 06, 2009
The February Employment Situation
Figure 1: Nonfarm payroll employment, seasonally adjusted, various releases. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M03). Source: BLS, employment situation, various releases, and St. Louis Fed FRED II.
Aggregate hours worked continue to decline at a faster pace than employment; they are now 5.6% below 07M12, as compared to 3.2% for employment (in log terms).
Figure 2: Log Nonfarm payroll aggregate weekly hours (blue), and Log Nonfarm payroll employment (red), seasonally adjusted, normalized to 0 in 2007M12. NBER defined recession dates shaded gray (assuming recession has not ended by 2009M03). Source: BLS, employment situation, February release, via St. Louis Fed FRED II, and author's calculations.
Discussion of the results from the household survey (not pretty either!) at RTE.
Posted by Menzie Chinn at March 6, 2009 08:20 AMdigg this | reddit
Even Bloomberg is recognizing the obvious: �Obama Bear Market� Punishes Investors as Dow Slumps (Update2) http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a5o50mgg9hWA
Posted by: Rich Berger at March 6, 2009 10:59 AM
Why are you not including November in Figure 1?
I still say 131M jobs will be the bottom in jobs. 2.7M more to go.
Posted by: GK at March 6, 2009 11:35 AM
Even Paul Krugman is moderately unhappy with Obama, and it has only been 6 weeks!
Posted by: Heterosexual at March 6, 2009 11:45 AM
But GK, the rationale for your numbers?...for those of us who have not yet recognized your competitive stature with Madam Sousa and her prognostications. For the curious...to hell with the gamblers. Sousa has been soakin us for years, treatin us like children, you know?
CR has a close look at the part-timers and mo.
I continue to put the data, esp the labor data, under the shadow of the purported 12M "illegal aliens".
I can even be distracted by considering all that RE manpower now available for real work...as soon as their dwindling savings make it imperative.
Posted by: calmo at March 6, 2009 12:18 PM
Yawn.... why do I have to give a rationale? Where is your counter-prediction? Instead, you put forth cryptic babbling. What value does your existence provide?
Put up or shut up.
Posted by: GK at March 6, 2009 03:24 PM
I think that for comments to be useful for a wider audience, it would be useful for people to aim to provide an explanation for their conclusions and/or predictions. Courtesy and clarity, I think, would enhance the exchanges.
Posted by: Menzie Chinn at March 6, 2009 05:07 PM
Danke schon Herr merill lunch
und GK und Menzie.
You B right: I can learn this civility and courtesy, possibly even der deutche.
I have no alternative guesses, not even a bs estimate, GK. Most of it is that I would rather look at the calculation, --the work, the thinking that went into whatever the "prediction" number is.
I even prefer the wrong number, if the work just demands your attention and respect. The right number could just B lucky. Anso the next time, you rely on the same lucky circumstances and get disappointed twice: the result is wrong and worse, you have grounds to improve your performance next time other than luck.
So, I apologize for being a tad short with my request for your estimate, which I know was not just a guess, but unless you provide some calculation, some work...it looks like you think this is a BINGO hall. [So looks like I'm here to give you feedback on the impressions you create (raison d'etre), and you're here to discard my feedback as nasty gratuitous antagonism.] I'm not half nasty.
Well, what about the quality of the data --esp the labor data which contains some "illegals" and the recent transition where we saw manufacturing jobs diving while RE jobs rose is not a symmetrical change with the former being much more closely monitored and measured, yes?
Posted by: calmo at March 7, 2009 02:36 AM
Editor's note: Calmo is responding in part to a comment in German that was deleted. Econbrowser requires that all comments be written in English.
Posted by: JDH at March 7, 2009 05:17 AM
I have commented before about the Democrat minimum wage law that was passed a few year ago. The second phase went into effect just a few months before the market fell apart last year. Now that we are seeing unemployment rival the Carter years we will see another minimum wage shoe fall on the economy. June 2007 it went to $5.85 an increase of 14% (how many of you saw a 14% increase in your pay recently), June 2008 $6.55 or 12%, then June 2009 it will go to $7.25 or 11%. In three years in perhaps the worst economic struggle in our nation's history the minimum wage has increased 41%. Remember this is only at the Federal level. Many states have raised the wage even higher.
Soon you will be hearing how awful it is that more and more people are being paid minimum wage, but don't be fooled. As the minimum wage increases the increase must be made up somewhere so those who were making more than minimum wage will find themselved locked into a minimum wage existence.
Increases in the minimum wage are more destructive of labor than they ever are to business. If we fail to learn this unemployment and low wages will become chronic.
Posted by: DickF at March 8, 2009 10:05 AM
DickF: Increases in the minimum wage are more destructive of labor than they ever are to business. If we fail to learn this unemployment and low wages will become chronic.
Yeah, people making $13,000 a year are the cause of all this unemployment! Is that supposed to be a joke?
Posted by: Joseph at March 8, 2009 11:35 AM
Don't be so shallow. Think deeper. When any cost rises on the low end it filters up the chain. This is true of minimum wage. The employee making $15,000 a year (what the wage will be in June) puts pressure on the employer paying his employees $20k. When their wage is increased the next level increases the pressure.
Obviously you have never run a business or worked a minimum wage job or you would not be so mean spirited.
Posted by: DickF at March 9, 2009 04:49 AM
Hmm! empirical data seems to show minimum wage increases of this magnitude increases unemployment. I argee. I would sooner keep the productive higher paid employees, ask them to work even harder, and pay them more, that is split the minimum wage employees job up among my other workers and lay the minimum guy off. I might even keep a portion of the former workers wages for profit! Goverment interference in the free market kills!!!
Posted by: Steve at March 9, 2009 06:55 AM