Here is a summary of my post-Employment tweets at @inflation_guy, for those not on Twitter and those who just want to see them all together. I also include a chart and some commentary:
- Ouch. #Canada added 1/3 as many jobs as the US did last month, and that nation has 1/9 of the population.
- Awful payroll data - 34k lower than expected with an additional -41k revision.
- Unemp rate fell from 8.254% to 8.111%, looks like a 0.2% fall but only b/c rounding. And it was all labor force shrinkage.
- Saw comment that the unemp # matters politically. No it doesn't. These are numbers. What matters is what people feel is happening. And
- ..and with employment, the man on the street doesn't need the government to tell him if the employment situation sucks.
- Weekly hours back to where we started the year. And Participation Rate now at the lowest level since 1979.
- One thing this ought to do is quiet the conspiracy theories about how Obama is cooking the numbers! Couldn't have cooked up worse.
- Internals even worse: I follow "Not in Labor Force, Want a Job Now". Highest since they strted asking that qn: [Note: I include this chart below]
- 7 million people aren't even looking for work, but want a job and would take one if offered. 7 million!
- Don't worry too much about hourly wages meaning deflation is coming. Wages follow #inflation, they don't lead.
Here's the chart referred to in the second-to-last tweet (Source: BLS):
Republicans, don't cheer because we got a weak number. It isn't the number that causes trouble to the Obama campaign; it's the perception of the job market and that's not necessarily correlated to the number itself. Perceptions were already bad, and it's more likely this number is slightly understated.
Democrats, don't cheer because of the decline in the Unemployment Rate. You might think it makes a nice talking point, but if you crow about the improving labor market people will think you're an idiot. The labor market isn't improving. It's stagnating, at best; at worst, the crisis in Europe and the weakening of growth in Asia is dragging our increasingly export-sensitive economy down.
In fact, both sides of the aisle should be crying. But watch stocks jump! It's a little disappointing to me, actually, since more pundits will now get the QE3 call right. However, this number didn't "seal the deal" - it was already sealed, and the Fed was going to be easing next week no matter what today's number was.
