No matter how you slice it, we don’t have much by way of good economic news. The unemployment numbers for September 2009 came out, and the news isn’t good.
Job losses moderated in August, but the unemployment rate ticked up 0.1 percentage point to 9.8%, the highest level since June 1983.
But another more comprehensive gauge of unemployment ticked up even more. The government’s broader measure, known as the “U-6? for its data classification, hit 17% in September, 0.2 percentage points higher than August.
The comprehensive measure of labor underutilization accounts for people who have stopped looking for work or who can’t find full-time jobs. The U-6 figure is the highest since the Labor Department started this particular data series in 1994. But, similar to the headline unemployment rate, it likely isn’t as bad as it was in the 1980s. U-6 only goes back to 1994, but a discontinued measure has a longer history. That old U-6 measure peaked at 14.3% in 1982. Through some calculation, a comparable measure can be determined in the current report. Under the old U-6 methodology, the September rate would be 13.5%, the highest rate since 1983, but still below the peak.
Ow. But things could be worse! President Obama has praised the $787 billion economic stimulus plan he signed, claiming pie-in-the-sky numbers before his inauguration:
President-elect Barack Obama said on Saturday an analysis of his stimulus proposals showed that up to 4 million U.S. jobs could be saved or created by 2010, nearly 90 percent of them in the private sector.
Obama said previously his estimated $800 billion plan to lift the country out of a yearlong recession would create or save 3 million jobs, but the new analysis showed that number would range between 3 million and 4 million.
Good thing the stimulus package was passed. If we hadn’t passed it, the White House predicted we’d have unemployment as high as 8.8% instead of the 7.9% unemployment we have now, thanks to the stimulus package.
That’s right — Obama predicted that without the stimulus package, unemployment would peak out at a nasty 9%, but thanks to his skillful leadership, it would not crest 8%. So, who are you going to believe, Obama, or the lying Bureau of Labor Statistics?
I’ve read that our economy has already turned the corner and the economy is improving, so why aren’t the jobs coming back? And why should they come back? When a business hires someone, the business is looking to the future and confident about what it holds.
But what is there to inspire confidence in business today? Is government going to pass a Cap and Trade bill that will greatly increase the cost of energy and doing business? Is government going to meddle with the banking industry again? Is government going to take over the health care industry? Is there anything government won’t mess with in the next few months, let alone the next few years? If I were an employer, I’d be scared spitless about what the future holds, and I’m not sure if I’d be willing to bet my company on what the government will or won’t do.
Uncertainty about the future, mainly at the hand of an increasingly meddling government, explains why the job market shows no sign of recovery. Here’s a graph that puts the current recession in perspective.
The economy would do much better if the government would get out of the way.