7.7%? Maybe – But 540,000 People Had To Leave The Workforce To Get There

CNBC starts off with a little cheerleading:

The U.S. economy created 146,000 new jobs and the unemployment rate slid to 7.7 percent, in a report much better than economists had expected.

Despite the effects from Superstorm Sandy, the jobs engine continued to run, albeit slowly.

Well, really it didn’t. Buried at the end of the report is this:

Previous month’s employment gains also were lowered through revisions.

The Labor Department’s initial report for October showed a gain of 171,000 jobs, but now is listed at 138,000. The September gain of 148,000 was taken down to 132,000.

On they go:

The Labor Department said the storm’s effects might be more accurately gauged in next months’ report.

But internally, the report showed weakness.

The numbers had some puzzling contradictions, particularly in the assertion that Sandy “did not substantively impact” the jobs count for November, and in substantial downward revisions from previous months.

Also, the drop in the unemployment rate appeared to reflect little more than a continued exodus of workers from the labor force.

The labor force participation rate, already around 30-year lows, fell further in the month to 63.6 percent. That represented 350,000 fewer workers.

But they seem confused by percentages and fractions – zerohedge isn’t - their numbers tie out and they say that it wasn’t 350K but 540K who dropped out of the workforce:

Confused why the unemployment rate dropped? The same, favorite BLS adjustment – a drop in the labor force participation rate which declined by 0.2% to 63.6% once again, as the number of people out of the labor force increased by over 540K to 88,883,000.

Math is hard.

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6 thoughts on “7.7%? Maybe – But 540,000 People Had To Leave The Workforce To Get There

      • Utah,

        That was already a done deal. Our society has crossed the Rubicon, my friend. It will take a total collapse and years of misery to turn us back now. This is just human nature and history teaches us that it ALWAYS happens this way.

        This is why everyone was attacking me for being a pessimist for the past 3-5 years: because I saw that the change had already happened, so I was just expecting it to manifest itself in the real world. Deep down, you know all of this, yourself. I know you do because I know you study history, as well.

        Now, for whatever it’s worth, I understand the pain and lament of such needless loss. We have lost a nation. But I wonder, even among those who see the loss of the nation, how many understand that it means so much more? We are about to lose the world. :-(

  1. One good thing has happened, Michigan is now a Right To Work state! IMHO, all 50 states should be Right To Work. Looking around the SF Bay Area now it may be hard to believe, but when I moved to CA the biz community here was bustling. There were so many opportunities here for entrepreneurs, new businesses were springing up almost daily and jobs were plentiful. Back then, even CA was Right To Work.

    Take a walk through the SF financial district today and you’ll see the homeless have even left, not enough workers to support them anymore. It’s sad to see the powerhouse that was once “the Wall Street of the West” broken and empty. There just seems no way to convince America that capitalism is still a poor kids best friend.

  2. Pingback: Common Sense Junction Political Blog

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