Chart of the day

The Labor Department reported that the unemployment rate declined significantly to 8.6% — the lowest level in 32 months. For some perspective on the current state of the labor market, today’s chart illustrates the unemployment rate since 1948. As the chart illustrates, the unemployment rate has been generally trending lower. However, the pace of that overall downtrend has been significantly slower than what has typically occurred following previous peaks in the unemployment rate. Though, following the previous two recessions, it did take much longer than normal for the unemployment rate to peak. While the significant decline in the unemployment rate for the month of November is a positive step, it is worth noting that the current unemployment rate remains at a level that was surpassed only during two previous periods (1975 and 1982-83) over the last 60+ years.



And a different perspective from MISH’S   Global Economic Trend Analysis. As usual you have to be very careful when looking at statistics.





6 thoughts on “Chart of the day

  1. The problem is that labor force participation rate is also dropping so just reporting lower unemployment rate does not say much

  2. Besides the unemployment numbers, this was a good week in economic reports.
    Tue: Consumer Confidence 56 actual vs 43.9 survey vs 40.9 previous
    Wed: ADP 206k actual vs 131k survey vs 130k previous, Chicago PMI 62.6 actual vs 58.5 survey vs 58.4 previous
    Thu: ISM Manufacturing PMI 52.7 actual vs 51.6 survey vs 50.8 previous, Total Vehicle Sales 13.6 m actual vs 13.4 m survey 13.3 m previous. Furthermore, the Manufacturing New Orders subcomponent reached 56.7 which is a strong reading and it is important because New Orders are a leading indicator. Also, US auto sales rose to the highest level since the ‘cash for clunkers’ program in the summer of 2009. Given that even the luxury sector saw strong growth it is hard to think that the economy is heading back into recession.
    I was skeptic after Wednesday’s rally, but it seems the market finds some support in economic recovery, beyond the central banks bailout.

    1. Indeed, good week for US data. Although, you need to check out the update in the Chart of the day post. Puts things a little into perspective.
      To be honest, I will wait before getting giddy about US recovery. Europe still has a lot to solve and could undermine US recovery further.
      What I am afraid of is that after ECB bails out euro zone we will look at the US debt in more detail. Without a clear plan to reduce it markets will start the same dance as they did in Europe to force more and more QE/bailout.

      1. I agree that we should be more cautious regarding the unemployment numbers. But it is pretty obvious that things go better, the NFP was revised up for September and October (from 158k to 210k and from 80k to 100k) and the number of workers unemployed for 27 weeks or more declined to the lowest level since October 2009, but is still very high.
        As usual, Calculated Risk has insightful analysis about jobs data. Check this out:
        However, the outlook for US economy is encouraging, but as you said Europe remains a bigger threat. The next summit on December 9th is almost critical, although I dont expect a miracle. 🙂

  3. The employment is worse than ever, as a level, the rate is lower then even 2010, more people than ever would want a job, but can’t get it, which actually means that US doesn’t have a decrease in unemployment but a decrease in the number of those receiving benefits :).

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