The Market Ticker
Commentary on The Capital Markets- Category [Employment]
2017-11-03 09:33 by Karl Denninger
in Employment , 201 references
[Comments enabled]  

The Bureau of Lies and Scams vomited forth:

Total nonfarm payroll employment rose by 261,000 in October, and the unemployment rate edged down to 4.1 percent, the U.S. Bureau of Labor Statistics reported today. Employment in food services and drinking places increased sharply, mostly offsetting a decline in September that largely reflected the impact of Hurricanes Irma and Harvey. In October, job gains also occurred in  professional and business services, manufacturing, and health care.

Suuuure it did.

From the household survey (which is reported from an actual survey of real people) the employment:population ratio declined three ticks to 60.2%.  This put us back to approximately April or, if you prefer, last July (2016, not 2017, which was 60.1%.)

It's simply amazing that while the unemployment rate has continued to fall like a stone the percentage of people working as a percentage of those who are 16 or over has failed to return to its previous pre-recession levels.  You will note, I'm sure, that prior to the last recession these two curves tracked quite well.  Then the big dive happened, the so-called "recovery" happened but one figure, reported by the Bureau of Lies and Scams as the  "unemployment rate" dropped below pre-recession levels while the other failed to rise to anywhere near the previous highs.

The usual "explanation" is Baby Boomers retiring.  That's an obvious lie given the "step function" in the data; the disconnect appeared in basically one year and has not been repaired since.  The Boomer generation spans roughly 20 years and yet right up until the moment of the '08 crash employment:population tracked the unemployment rate (inverse) very closely.

In other words one of those figures has to be wrong in terms of showing the relative strength of the US economy when it comes to jobs and the so-called common explanation trotted out by the media "analysts" is flat-outsmiley.

You can either believe the Government or you can believe people.  I know which I believe.  It's not like there isn't 10 years of rather-obvious and continuous obfuscation in here following what used to be a pretty-clean, but noisy sequence, right?  Oh wait....

Among the household survey this month shows that 633,000 people lost jobs.  I remind you that last month, the so-called "bad" month, there were nearly a million jobs gained.  The 12 month trend is deteriorating badly; it now stands at +1.526 million and, while highly noisy that's not a good number at all (as it would imply just over 100k jobs/month.)  The culprit is 872,000 people who gave up and left the workforce last month. 

Net of working-age population change on a 12-month rolling basis the economy lost 837,000 jobs.  In other words, number of jobs added minus working-age population change over the same 12 month period.  That's not good either.

The Bureau continues to cheer on (as does Trump) 22,000 "jobs" in the health care sector, nearly all of which are in fact not doctors or nurses.  In other words they're parasitic jobs, roughly 250,000 of them over the last 12 months, and every one of them not only contributes not one second of care to actual persons they are partly responsible for the double-digit increase in health care premiums.  But, as we're force-fed by the media and politicians, it's "good for the economy" when you're forced by law to subsidize someone else's $50,000 a year salary the benefit of which is only to them and the cost of which is on you.

That sounds a lot like welfare, doesn't it?

The "reporters" all seem to have no understanding of why, with the "unemployment rate" at 4.1%, we're not seeing any material increase in hourly earnings.  We should be, of course; the laws of economics have not been repealed (they're called "laws" for a reason.)  It isn't happening because the so-called "rate" is a lie; the employment:population ratio proves this.

Of course were that to be recognized the market would instantly crash because then people would have to ask on what are these "earnings" supported?  The answer is, of course, is the $693 billion in US Federal Debt issued over the last 12 monthswhich is 3.56% of claimed GDP.  Since the claimed GDP run-rate is less than this in fact GDP is negative in real terms -- and that's counting only federal government issued debt.  Add in the nice chunk of fraud-laced inducement for young adults to take on "student loans" and you'll find a big additional component of the problem.

The most-amusing part of the claim of such a strong report is that in Table A-1, which splits out employment changes by gender and age brackets (with little granularity, but still) fails to show even one bracket where employment:population improved.  Among women 20+ it was stable; every other group lost.

So yeah, the data is right there in front of you in the report to show exactly what is going on, but exactly zero of the comments I've seen thus far in the media speak to it.

Gee, I wonder why?

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