Feburary 7, 2011
The U.S. government is telling us that the unemployment rate fell all the way down to 9.0% in January. Should we all cheer? Is it now going to be a lot easier to find a job? Has the economy finally turned around? Are happy days here again? Well, it is a good thing to have a positive attitude, but the truth is that there is just not much to cheer about when you take a closer look at the recent unemployment numbers. First of all, the U.S. economy only added 36,000 jobs in January. Economists had been expecting an increase of about 145,000 jobs, and an increase of 150,000 jobs per month is necessary just to keep up with population growth. So why did the unemployment rate go down? Well, the government says that over half a million Americans suddenly dropped out of the labor force in January. That doesn’t make a lot of sense, but this is how the government calculates their numbers. So what happened to those 500,000 Americans? Did they all win the lottery? Have they all become independently wealthy? Did they all die? No, the vast majority of them are still around and the vast majority of them still desperately need jobs. It is just that the government does not count them as “looking for work” anymore.
It would be great if the employment situation in America actually was getting better. All the time people send me absolutely heartbreaking stories about what they have had to endure in this economy. Soon I hope to share some of those stories with you all. It is hard to try to describe the absolute horror that many Americans are going through right now.
People would like to believe that things are going to get better, but unfortunately that is just not going to be the case. The government can try to massage the numbers to make them look better, but the truth is that the tens of millions of American families that are deeply suffering right now are not fooled.
The following are 10 statistics that reveal that the latest unemployment numbers from the government are no reason to cheer….
#1 According to CNBC, economists were expecting the U.S. economy to add 145,000 jobs during January. Obviously the 36,000 figure was a huge disappointment.
#2 Approximately 150,000 jobs need to be added to the economy each month just to keep up with population growth.
#3 The government jobs report also indicated that 504,000 Americans “dropped out of the labor force” in January. That may make the unemployment numbers look better, but the truth is that the vast majority of those 500,000 Americans still need incomes and still need jobs.
#4 According to the latest numbers from Gallup, the unemployment rate actually increased to 9.8% at the end of January.
#5 Gallup’s measure of “underemployment” (those that are unemployed plus those that are working part-time but want full-time employment) was sitting at 18.9% at the end of January.
#6 As I reported yesterday, there are approximately 28 million Americans that would like full-time jobs but that don’t have full-time jobs.
#7 According to Zero Hedge, the number of Americans that are “not in the labor force” but that would like a job right now has hit an all-time record high. If you add all of those people into the official unemployment figure it would jump to 12.8%.
#8 According to Calculated Risk, this is the deepest and most brutal employment downturn that the United States has experienced since World War II. The current employment downturn started 37 months ago and there doesn’t seem to be any indication that we will return to pre-recession levels any time soon.
#9 The U.S. Labor Department has also announced that job growth during 2010 was much weaker than they had previously reported. The numbers for 8 months were revised down, and the numbers for 4 months were revised up. After all of the revisions are accounted for, it turns out that a total of 215,000 fewer jobs were created during 2010 than originally calculated.
#10 According to one brand new survey, 4 out of every 10 Americans are struggling “a lot” to pay the bills right now.
The situation is not pretty out there. The U.S. needs tens of millions more jobs than we have right now.
So where are all of our jobs going? The video posted below contains some very strong hints. The truth is that globalism is ripping our economic infrastructure apart, and all of the crazy rules and regulations we keep heaping on business are not helping either….
U.S. workers have been merged into a “global labor pool” where we are expected to directly compete for jobs with people making slave labor wages on the other side of the globe.
The more time you spend thinking about that, the more you start realizing that the standard of living of average American families is going to continue to decline.
Unfortunately, as I wrote about in a recent article entitled “Nothing Is Stable Anymore“, the world is changing faster today than at any other time during our lifetimes. Everything that we used to assume about employment, money, our economy and our finances is being turned upside down. We now live in a world where very little can be taken for granted.
2011 has already been a very tumultuous year. The world is being transformed. Nobody knows for sure what is going to happen next.
One thing to really keep an eye on is the price of oil. Right now, large numbers of investors are betting that the price of oil will rise to $125 a barrel by May. Shockingly, some investors are even betting that the price of oil will rise to $250 a barrel by next December.
If oil starts to spike dramatically, it will have tremendous implications for the U.S. economy. Our entire economic system runs on oil. The price of oil affects the price of everything else.
If the price of oil keeps going up it is inevitably going to cause a slowdown in the U.S. economy and it will cause the unemployment situation to get even worse.
So be glad that the employment situation is at least somewhat stable for now, because if things take a bad turn for the worse in 2011 who knows what kind of unemployment numbers we’ll be talking about a year from now.
This article was posted: Monday, February 7, 2011 at 11:32 am