Sense on Cents

The highly anticipated monthly unemployment report was just released. On the surface, the numbers may appear to be in line with expectations, but looking deeper into the numbers the report is actually worse than expected. Let’s dive into the numbers and comment on what they mean for our economy and markets.

The Unemployment Rate jumped from 7.6% to 8.1%. The rate was expected to move to 7.9%. The 8.1% rate is a 25 year high.

Non-farm Payrolls lost 651k jobs against an expectation of a loss of 650k jobs. In line with expectations, right? Well, one needs to look at the revisions to the prior two months to get the full picture. Non-farm payroll revisions from the prior two months show a further loss of 161k jobs over and above initial reports. That’s ugly!! Total jobs lost since December 2007, when the recession officially began, are 4.4 million!! More than half of those jobs have been lost in the last 4 months.

Average hourly earnings only rose .2. This number is not exactly robust and will further pressure consumers who are already cash constrained. (more…)