Jun 30 2009
Update: Well, the ADP numbers are out and – as predicted – the job situation is worsening:
Companies in the U.S. cut more jobs than forecast in June, according to a private report today, showing the labor market will be slow to improve even as other parts of the economy indicate the recession is abating.
The 473,000 drop in the ADP Employer Services gauge followed a revised reduction of 485,000 workers in May that was smaller than previously estimated.
Job losses may mount as the bankruptcies of General Motors Corp. and Chrysler LLC ripple through manufacturing. Increased firings threaten to further restrain consumer spending at a time when the worldâ€™s largest economy is showing signs of stabilizing.
Stabilizing = hitting bottom. There is no recovery, because the liberal fantasy of a government funded stimulus is a pathetic joke. Will America reward the failures of Obama, Pelosi and Reid to fix the jobs problem withÂ reelection? I seriously doubt it. If states like California are seeing continued job losses (as predicted through 2010) I cannot see that state remaining Democrat blue. With a filibuster proof majority, the Dems now own this economic disaster. - end update
We enter the mid year point of summer with a reminder of how badly the liberal economic fantasy policy of government funded stimulus have failed (vs the tried and true tax cut stimulus that has worked since John F Kennedy employed it). Tomorrow, as Tiernan Raye points out at Barron’s Blogs, is going to set the tone for a very bleak summer for this nation:
Preceding that report will be the ADP payroll report, tipped at a decline of 390,000 for June. And that will provide the warm-up for Thursdayâ€™s employment report for June, expected to show a drop similarÂ to Mayâ€™s 345,000 decline, and then an early exit for the holiday weekend.
Yes, ADP has an independent survey which sometimes tracks with the government numbers, but sometimes does not. But what is most important in this post is the fact that the US unemployment numbers are no longer accurate, and hide the true depth of the unemployment emergency:
â€œWe have 6.7 million Americans on continuing claims and another 2.4 million who are still collecting, i.e., still a drag on the social system, but who are no longer counted as they are on â€˜extensions,â€™â€ writes Joan McCullough of East Shore Partners. â€œI wonder how many millions will be unemployed and uncounted once those extensions expire.â€ Adds MacroMavensâ€™ Stephanie Pomboy, some 49% of the folks losing their benefits havenâ€™t found work.
Emphasis mine and Hat Tip to reader MerlinOS2 for the heads up on the fudged numbers coming out from the same Democrat who promised unemployment would not go over 8% and still think there is global warming after a decade of cooling temperatures. The possible dirty little secret is there may have been a plan to hide the true unemployment numbers by only counting those on the primary unemployment benefits, not those without jobs on extensions. Any surprise there was a new unemployment ‘extension’ benefit added as part of the stimulus package? By keeping these people funded on an uncounted program the government is not only rewriting history, it is rewriting reality. It is lying to us, who gave them our hard earned money to fix the problem.
We can do a quick calculation to estimate the true unemployment rate for May using the figures above. 6.7 million is around 73% of the total number of 9.1 million people out of work the government knows about. That means the 9.4% unemployment rate of May is only 73% of the actual rate, which means the real unemployment – as directly known to the federal government – is just under 12.8%! Â
I can see why someone may not want to tell the complete truth here and then face us tax paying voter next year.
More details came out this week on how badly the Liberal Dems botched their stimulus efforts, which have done nothing but put this nation into massive debt. For instance, the pain of unemployment the liberals allowed to fester on this nation has now reachedÂ in all majorÂ metropolitanÂ areas:
Layoffs tied to the troubled housing and autos industries clobbered the West and Midwest in May and helped raise unemployment rates in all the largest metropolitan areas for the fifth straight month.
All 372 metro areas saw joblessness rise in May from a year earlier, the Labor Department reported Tuesday. The highest rates â€” of at least 15 percent â€” were concentrated in metro areas in California, Michigan and Indiana.
California is such an economic wreck that it has the honor of hosting half of the hardest hit cities in the nation:
Almost half of the cities with 15 percent-plus jobless rates last month were in California, with El Centro at the top of the list with a 26.8 percent unemployment rate.
Yuba City had the second-highest jobless rate in the state at 17.7 percent, while Merced, Modesto, Fresno, Redding and Stockton also endured 15 percent-plus jobless rates, according to a federal report released Tuesday.
And much of this is due to the fact the liberals relied on the sluggish and bloated federal bureaucracy to ‘stimulate‘ economic growth. Of the 6 government entities I am monitoring, which represent 1/3rd of the stimulus jobs money and include the two departments with the lion’s share of the money (Energy and Transportation), none as actually spent even a paltry 1% of the money allocated to them (as of 6/12/09). That means 99% of that money is stuck in the constipated bureaucracy as millions of people not only are out of work, but rapidly running out of benefits.
BTW – that $105 trillion dollars I am tracking represents 1 million jobs at $105,000 for a year. If this was doled out in tax cuts, businesses could have used that money to create 2-3 million high paying jobs (maybe more). And that is only one third of our hard earned tax money sitting in the government, being chewed up slowly by bureaucrats. Tax cuts would be working for 5 months now. Instead we got the reality gut check for the Obama-Reid-Pelosi liberal fantasy of government funded recoveries.
As we see above, once you run out of unemployment benefits you no longer are counted as ‘unemployed’. The 50% of those Â who went on unemployment back when this began and who cannot find work will soon be dropping of the roles. Broke and forgotten, and not even counted as a victim by our own government.Â
How pathetic is that for Hope & Change?
Als0, don’t hold your breath that forces outside this country will be coming to our rescue. When we get a cold, the world economies getÂ pneumonia.
Update: What we need is a measure of the “hidden unemployment rate” – also known as the real unemployment rate. No more faked and fudged data from those clowns in DC>