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Fri Apr 6, 2012, 02:25 PM

About the current Employment Summaries Report.

The first report is ALWAYS preliminary; they don't always get all of the data in time for the report. The number will be revised.

Because this is seasonally adjusted, it's VERY possible for the numbers to be understated or overstated. Any large shifts either way knocks their formulas off.

One important part of the report seems to have been overlooked as the pundits start their spinning:

The number of persons employed part time for economic reasons (sometimes
referred to as involuntary part-time workers) fell from 8.1 to 7.7 million
over the month. These individuals were working part time because their
hours had been cut back or because they were unable to find a full-time
job.


So based on this preliminary data, 400,00 part-timers were most likely bumped up to full-time. While the report doesn't explicitly quantify that, we can infer that from the fact that a net 120,000 jobs were created. I'm assuming that if those 400k were terminated from their part-time jobs that we would see a net reduction in job creation and a flush of new unemployment claims...

That's actually REALLY good news since these people often receive partial unemployment or other forms of assistance.

Compare that to February:

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) was essentially unchanged at 8.1 million in
February. These individuals were working part time because their hours had been cut
back or because they were unable to find a full-time job. (See table A-8.)
One data point really isn't that useful, in this case we were hoping for a continued trend over 200,000+ added jobs over the past 4 months.


And January:

The number of persons employed part time for economic reasons, at 8.2
million, changed little in January. These individuals were working
part time because their hours had been cut back or because they were
unable to find a full-time job. (See table A-8.)



So the right-winger will crow about a lackluster jobs report but remember that one data point isn't significant unless it establishes a trend. Prior job reports were revised up, signs point that this one will be bumped up as well.

If we see another jobs report next month that is underwhelming AND this jobs report isn't revised up, THEN we can start worrying again. For now, consumer confidence is up, retailer confidence is up, GDP is performing well, the stock market is performing well, manufacturing is up, the car industry is doing exceptional... all are good signs.

Does this mean that every thing is strawberries and creme? No. A few of dark spots remain. Housing will be an issue for the next 5 years at least, it took almost 10 years for housing to bubble and pop and that sucked trillions of dollars out of the economy.

Fuel prices are another issue. I would like to point out that fuel prices are inevitably going to increase as a result of increased demand (this post isn't about whose responsible for the fuel increases so please to use it to beat me over the head with a strawman!! ) BUT it does have a cooling effect on everybody who isn't planning on installing a "car elevator" in their 6th home.

Government workers continue to be laid off. This report shows that it may have slowed for now, but " target="_blank">A half million government jobs have been cut since 2009. That has an effect on the overall numbers, particularly when jobs are being created at a breakneck pace. The USPS is at risk of going belly up, by REPUBLICAN design (with the help of Democrats unfortunately), which will send tremors throughout the entire economy.



So yes, while we can look for silver linings, there are some rumblings in the clouds. However, overall, things ARE improving and will hopefully pick up the rate of improvement over the next several months.

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