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Friday, September 7, 2012

August 2012 Jobs Report Analysis

The August '12 jobs figures came out today as it does the first Friday of every month from the Bureau of Labor Statistics and to really sum everything up in one word, it is this -- gobbletygook.

And because it is gobbletygook, any one can look at it and take n' make from it whatever they wish.

If you're Democrat and/or a supporter of Obama, you can celebrate and trumpet the fact that the official unemployment rate Dropped down to 8.1% from 8.3% in July, and then hope people stop caring about the true data after that statistic.

If you are Republican and/or a supporter of Romney, you can look at the fact and say that was based on 368,000 people officially off the books when it comes to the BLS.  They've given up looking and thus, poof.. they don't count in the stats.

The way the math works,  without genuine job creation, for each one-tenth of one percent improvement in the unemployment rate, 184,000 Americans had to become quitters.
You also can point to only 96,000 new jobs created in August compared to estimates of 125,000 (which is still terrible) and claim as a Conservative, that if your guy was in office, things would be better.

And if you're a blood sucking parasite who makes his/her living on Wall St, you can use the weak jobs report to all but assume another round of QE will be announced next Friday which of course continues to weaken the currency, adds to the Debt and does NOT create jobs...

But c'mon.. you work on Wall St-- do you really give a fig as long as its coming?

Now let's do some basic math:

96,000 new jobs divided by 50 US States =  1,920 new jobs per state on ave.

Here's a little more depressed way to look at the figures:

In the US, there are 3,009 counties, 64 parishes, 16 boroughs and 41 independent municipalities or 'cities'...  when you add up those numbers, it comes to 3,130
96,000 new jobs divided by 3,130 = 30.67 which we'll round up to 31 jobs created on average for each county, parish, borough, and city for the month of August.

And people will give the 'whys' and the 'how come' and all that...

Really, what does it matter.

And here's the thing about the BLS--  besides the fact that they base their findings monthly on taking a poll or sampling of Fortune 500 companies to compile data, is that there's never a breakdown of REAL jobs (40hrs a week and/or jobs with benefits) vs part-time work or that grey fuzzy area of newly hired called Temps.

We've said this time and time again..  you have no right to expect the economy or employment to improve when those who have the power and means to make it happen (the President, Congress and the private sector) have done absolutely nothing to improve it, nor the motivation to do so.
Let's quickly break down the strategies of each of the three:

President Obama -  Oh, certainly he'd love to be campaigning with unemployment down to 3.7% and everyone feeling great as if it was 1984 or 1996.  Its not like Obama enjoys people suffering.

But there's political gambles and that of 'credit' and legacy.

Earlier this year, Obama tried to push a very large jobs-creation bill through but the Republican controlled House wouldn't let it through (we'll get into Congress agendas later)  Now Obama knew it would be blocked and he could get some political brownie points for trying.

But let's say a bill was presented that was less grandiose and maybe added some corporate tax cuts, which those fiscal conservatives love more than their mothers...  Perhaps there's enough compromise to get it through... and everyone goes Yayy!...
But.. let's say it takes 6-12 months for the affects to be felt positively in the jobless numbers and by then Obama loses?   From his perspective, why the hell would he want to do anything now which could give Romney unjust credit later??

And so from the Executive Branch point of view, there's been no motivation to do anything in 2012.. not as long as there's a chance Obama could be a one-termer while the next guy reaps the rewards.

Congress -  There are two parts to Congress:  The House of Representatives and the Senate.   And while the Senate has been Democrat controlled for the full duration of Obama's first term, the House fell into Republican control during mid-terms.

This makes it generally more difficult for a President of a differing party to get legislation through without great compromise

And political Republicans have absolutely no interest or motivation on seeing this economy improve prior to 2013.   None.   Obviously the better the economy, the better Obama's chances and the Reps would prefer everything look as bleak as possible a la Carter 1980 so they can get their guy into power and have (they hope) a repeat of the so-called "Reagan Revolution"

So absolutely no motivation unless...  you know... taxes were lowered on the very wealthy and corporate taxes eliminated all together... then you'd get them to sit down and work out job creation legislation... Only then..
So if you feel this economy is shit because Obama is not doing enough or doesn't care, you will perhaps sway to the Reps... and if you feel Obama is trying hard but the Reps are being obstructionist and pig-headed, putting profit over nation, you will vote the President in.

Now the third factor--most evil of them all...

The Private sector -  We don't speak of small to medium sized businesses trying to survive or individuals with fledgling start-ups.   We are speaking more specifically about Corporations.

And Corporations are absolutely LOVING the economic climate of the moment...

Think about it: This continual recession has allowed them collectively to shed millions of good paying jobs with health benefits, 401k, etc and either replace them with new workers forced to accept 10-20% reductions in pay or hire temps who have no protections, are paid next to nothing and are as disposable and replaceable as a 3oz Dixie cup.

Then you consider all the free money they receive from the Fed via QE.  This allows these businesses, that otherwise would suffer financially by their slash n' burn firing/hiring policies and weaker workforce, to have the capital to invest in themselves (buying their own stocks to make their corporation appear stronger than it is) or invest in other companies/sectors... all to please the shareholders.
There is absolutely no motivation for corporations to hire people at a good salary and perks unless their skill set was truly invaluable.   And as worthless as undergrad degrees were before the recession began, they're even more worthless now...

Think about it... should a person really need to go to school for 4 years and rack tens of thousands in debt simply to secure a job as a cashier at Best Buy or answering telephones for a Doctor's office?

So that's where we are on this Friday 9/7/2012

Now aren't you ready for some Football!!  Grins~