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Report from the U.S. Department of Labor statistics:

Employment:

The Unemployment rate remained the same in February at 9.7% from 10.0% in December.   

Nonfarm payroll employment held nearly level (-36,000) in February on the heels of a minor drop in January (-26,000 [revised]).  This followed a big drop in December (-109,000 [revised]), and a boost to prepare for the holiday season in November (+64,000 [revised]). 

The December drop could substantially be the result of seasonal employees let go by retailers.  Previous month changes were October (-224,000 [revised]), September (-225,000 [revised]), August (-211,000 [revised]), July (-344,000 [revised]), June (-504,000), and May (-347,000).  

The quarterly average nonfarm payroll job layoff figures have been improving steadily over the last 9 months.  The three-month averages of February 2010 through December 2009 (-57,000), November through September 2009 (-128,333), and August through June 2009 (-353,000).  In 2009, payroll employment declined by 4.5 million.  

Since the start of the recession in December 2007, payroll employment has decreased by 8.4 million, wiping out all the jobs created in the private sector over the last decade. 

Total unemployment dropped to 14.9 million (9.7%) after rising to 15.7 million (10.1%) in October 2009 from 7.7 million (5.0%) in December 2007 and from 11.6 million (7.6%) in January 2009. 

The numbers still indicate that companies are approaching their maximum “leanness” and sustain perceptions that the economy is approaching employment turnaround.

Unemployment is still the highest since April 1983.  In a healthy economy, around 125,000 jobs a month must be added and filled just to keep the unemployment rate stable.

The current rate is 9.7% and the number unemployed is at 14.9 million. 

This is the seventh consecutive month of unemployment holding steady within 0.3%.

The number of persons working part time for economic reasons (sometimes referred to as involuntary part-time workers) increased to 8.8 million in February.  Previous month part time figures were January (8.3 million), December (9.2 million), November (9.2 million), October (9.3 million), September (9.2 million), August (9.1 million), July (8.8 million) and June (9.0 million).  

These persons had their hours cut back to 34 hours or less or were unable to find full-time jobs.  Since the start of the recession, the number of such workers has increased by 3.7 million, and has remained relatively constant since March 2009. 

About 2.5 million workers are considered marginally attached to the labor force wanted and were available for work, and had looked for work sometime in the last 12 months.  They had not looked for work in the last 4 weeks and so were not considered part of the labor force. 

Among the marginally attached workers, discouraged workers (persons no longer looking for work) rose to 1.2 million in January, up by 473,000 a year ago. 

Long-term unemployed persons (jobless for 27 weeks and more) have tripled since the start of the recession to 6.1 million since December 2007, adding 3.6 million to that number since January 2009.  Four in ten (41.2%) unemployed persons are in this category. 

The average length of unemployment has dropped to 29.7 weeks in February from 30.2 weeks in January after steadily climbing since February 2009.

Ed.Note: The number unemployed (and the unemployment rate) includes only those who looked for work in the last 4 weeks, and changes as the Civilian labor force population varies. 

The number unemployed contrasted with the changes in payroll employment is accounted for by workers no longer looking for work and therefore dropping out of the Civilian labor force. 

As consumer and business confidence improves, more workers will start to look for jobs again, returning to the workforce in anticipation of better employment conditions, which drives the unemployment rate higher.  On the other side, workers drop from the work force for a number of reasons including giving up looking for work.

Industry sectors and historical data

Construction lost 64,000 jobs in February, perhaps due to inclement weather and low temperatures.  Previous month changes were January (-77,000), December (-32,000), November (-15,000), October (-67,000), September (-71,000), August (-64,000), July (-80,000), and June (-91,000), with a total of 1.9 million since December 2007. 

The quarterly average construction job figures have been improving over the last 9 months with three-month averages at: December 2009 through February 2010(-57,667), September through November 2009 (-51,000), and June through August 2009 (-78,333). 

Manufacturing gained 1,000 jobs in February.  Previous month changes were January (+20,000), December (-23,000), November (-25,000), October (-57,000), September (-48,000), August (-57,000), July (-43,000), and June (-129,000) with a widespread job loss total of 2.1 million since December 2007, mostly in the durable goods industry. 

The quarterly average manufacturing job figures have been improving steadily over the last 9 months with three-month averages at: December 2009 through February 2010 (-667), September through November 2009 (-43,333) and June through August 2009 (-76,333). 

Retail trade was unchanged in February.  Previous month changes were January (+42,000), December (-18,000), November (+9,000), October (-63,000), September (-43,000), August (-15,000), July (-53,500), and June (-24,400). 

The quarterly average retail job figures have been improving steadily over the last 9 months with three-month averages at: December 2009 through February 2010 (+8,000), September through November 2009 (-32,333) and June through August 2009 (-30,966). 

Professional Business Services gained 51,000 jobs in February.  Previous month changes were January (+30,000), December (+20,000), November (+109,000), October (+11,000), September (-22,000), August (-34,000), July (-48,000), and June (-132,000). 

The quarterly professional business services job figures have been improving steadily over the last 9 months with three-month averages at: December 2009 through February 2010 (+33,667), September through November 2009 (+32,667) and June through August 2009 (-76,000). 

Education and Health Services gained 32,000 in February.  Previous month changes were January (+16,000), December (+26,000), November (+31,000), October (+35,000), September (+26,000), August (+35,000), July (+21,000), and June (+28,000). 

The quarterly average education and health services job growth figures have been improving steadily over the last 9 months with three-month averages at: December 2009 through February 2010 (+24,667), September through November 2009 (+30,667) and June through August 2009 (+28,000). 

In a nonstop record of job growth, the health care industry has added 322,000 jobs in 2009.

Government employment (federal, state and local) lost 18,000 jobs in February.   Previous month changes were January (+7,000), December (-27,000), November (-11,000), October (+38,000), September (-39,000), August (+4,000), July (-47,000), and June (-52,000). 

The Federal government added 16,000 jobs (15,000 temporary workers for Census 2010).  The U.S. Postal Service lost 9,000 jobs.  Figures will show a net gain of 7,000 jobs, but it is really a net loss of 8,000 permanent jobs. 

State governments added 7,000 education jobs and trimmed 1,000 jobs in other areas.  Local governments lost 24,000 education jobs and trimmed nearly 8,000 jobs in other areas.

The quarterly average government employment (federal, state and local) job figures have been holding steady over the last 9 months with three-month averages at: December 2009 through February 2010 (-12,667), September through November 2009 (-4,000) and June through August 2009 (-31,667). 

Temporary help services added 48,000 jobs in February, a net gain of 284,000 jobs since September 2009.

Unemployment spreads stayed relatively the same with the highest among teenagers (25.0%), followed down by African-Americans, then Hispanics.  The lowest unemployment started with Adult women (8.0%) followed up by Asians (8.4%), Whites then Adult men (10.0%). 

The good news from this data is that the job losses are lessening.  It is perhaps due to fewer jobs available to lose, but the lower figures are an encouraging sign.  We look forward to job gains.   

Average weekly hours and overtime

These figures closely correlate with overall output and when workweek hours increase give clues when firms will start hiring. 

The average manufacturing workweek remained unchanged at 39.4 hours with overtime at 2.6 hours. 

The average manufacturing hourly earnings for production and nonsupervisory employees in February rose by $0.04 to $18.48 for January.  12 months ago the hourly earnings were $18.09 (+2.15%).  

Civilian labor force

The total Civilian labor force remained relatively constant at 153.5 million (up 342,000 from January).  There are a million fewer workers in the work force than in February 2009 (154.4 million).   These are generally workers who have given up looking for work. 

The Civilian labor force usually grows as a recession winds down and optimism about finding work grows.  But as long as Americans remain anxious about their jobs, consumer spending is not expected to grow enough to power an economic rebound. 

The employment population ratio (the proportion of the country’s working-age population that is employed), at 58.5 percent, has declined by 4.2 percent since the recession began in December 2007.

Comparing now with the final month of the last major downturn in November 1982, the total Civilian labor force then stood at 111.1 million.  In that month, there were 11.9 million people unemployed accounting for 10.8% of the available work force (average for the year was 10.6 million unemployed with the rate at 9.7%).  The average for 2009 was 9.3%, increasing from 7.7% in January to 10.0% in December.

Looking at jobs needed to reduce unemployment
with the total Civilian labor force at 153.5 million:

(r)=revised

To restore employment to the 5.5% level of 2008, about 6.5 million people will have to regain their job or start new jobs.  It is a tall mountain to climb. 

**Ed.Note:  Government and economists foretell that the “normal” unemployment rate will move up to 8% from its current 5.5% level.  With the current Civilian labor force, that means that on a permanent basis there will be roughly 12.3 million people unemployed — more than 3.9 million more than at the “normal” level today. 

Fastest growing occupations and Occupations with the largest job growth

It comes as no surprise that the fastest growing occupations 2008 and projected to 2018 are in the fields of network systems and data communication and all aspects of the medical field. 

The largest job growth fields also include office and administrative support jobs, sales and service jobs, as well as teachers and construction and transportation jobs.

Education and salary of course go hand in hand.  

Data collection:

The Census Bureau surveys 60,000 households across the country to insure an accurate demographic survey.  This translates into about 110,000 individuals.  All the counties and county-equivalent cities are grouped into 2,025 geographic sampling units.  824 of these units are selected to accurately represent the entire population of the United States.  For a detailed explanation, see the BLS Handbook of Methods. 

Each month, one-fourth of the interviewed households are rotated out.  They rejoin the sample after eight months, are interviewed for another four months, and then are rotated out forever. 

Each month, 2,200 highly trained Census Bureau employees conduct interviews in the sample households for information on labor force activities (job holding and job seeking) or non-labor force status of household members. 

This sampling method results in a 90+ percent probability that the results will be within 290,000 of the 153.5 million workers in the Civilian labor force.  A monthly total census would be cost-prohibitive. 

Questions are specifically formulated so that neither the interviewer nor the persons interviewed decide their labor force classification.  This prevents the sample from being distorted by respondents providing answers based on their opinion or what a “right” answer should be. 

The basic concepts of employment are: 

The unemployment rates are extrapolated from the survey results. 

The quoted unemployment rate excludes people who have stopped looking for work because they believe no jobs are available (discouraged workers) and others outside the labor force.  They are counted separately. 

Their number has nearly doubled in the previous 12 months.

 Stimulus (Recovery Act):

The president credits his $787 billion stimulus package of tax cuts and increased government spending with improving employment.   He hopes to create about 3.5 million jobs.  Lower estimates put that figure at 2 to 2.5 million jobs by the end of 2010, reducing the unemployment rate to 8+%. 

The Fed’s record-low interest rates, along with other moves to drive down loan rates and stimulate borrowing, have supported the economic rebound.

The White House Council of Economic Advisers released a report showing the plan would save or create 1.5 million jobs by the end of 2009 and 3.5 million by the end of 2010. 

A senior White House official stated that the Obama administration’s fiscal stimulus plan will meet their previous estimates to save 3.5 million U.S. jobs by the end of 2010, but the unemployment rate at that time may be higher due to further deterioration in the economy.  White House officials have been careful to point out that estimated jobs created and saved have merely slowed continued job losses.

The president is now drafting a proposal to try to stimulate more hiring.  Obama plans to send Congress a list of ideas, including new tax breaks for small businesses that hire, some new spending on roads, bridges and other construction and grants to state and local governments to avoid layoffs.  Congress is likely to take up a job-creation package in the New Year.

Stimulus spending by state 

As of March 2, 2010, of the
$295,881,863,670 announced,
$345,928,575,159 (116.9%) has been made available
$194,910,746,023 (65.9%) has been paid out to the states

 Recession histories:

With Nov 1982 unemployment at 10.2%, and the government taking aggressive action, it was still more than five years (April 1988) from the peak before unemployment receded to 5.4%. 

The approach that time, however, was to fix the economy at the expense of the worker.

Some compare the fall in employment to 1974-1975 and 1981-1982. If the comparison is accurate, the peak in unemployment may be reached within the next four to five months (past performance is no guarantee of the future).

Economist William Polley made a chart that includes every recession since World War II.  It makes the chart pretty hard to read, so he simplified it with selected post-WWII recessions.

William Polley’s chart shows how the recovery from the 2001 recession took four years for employment to return to its February 2001 peak. 

Using the Department of Labor unemployment tables of unemployment rates and 5.5% as the “normal” rate of unemployment, I have analyzed things a little differently.  Of course, along the way, the Civilian labor force increases, so the percentages represent ever more workers.

The following table shows unemployment start dates, peaks and returns to the normal rate of 5.5%, Civilian labor force in millions of workers for that year, and the lengths of times from the start date in months:

 Recession peaks 1974-2009 

Note that the unemployment peak period that started in 1974 and ended in 1979 (lasting nearly five years) was followed immediately by another peak period ending nearly nine years later.  By the end of that period, the work force had increased by more than 32%, meaning overall, almost 30 million new jobs had to be created.

 The aggressive increase in the Civilian labor force in that period can likely be attributed to post-World War II babies reaching adulthood, with some entering the labor force after secondary school and the rest entering the workforce after further education.

The periods from 1988 to 1990 and 1995 to 2008 were periods of prosperity, with low unemployment (but a building bubble). Here is the same data in graphic form:

Unemployment rates:
It is interesting to recognize that in most cases, unemployment peaks roughly one-third of the timeline for unemployment to return to its “normal” rate, so we can double the number of months from the Start to the Peak to expect to arrive at an approximate return to “normal.”We live in hope (again, past performance is no guarantee of the future).

The next Economic Jobs report will be found at:
Economic Picture: March 2010

The last Economic Jobs report will be found at:
Economic Picture: January 2010