We All Get Punched In The Gut

Chart from Calculated Risk

Calculated Risk:

From the BLS:

The unemployment rate edged up to 9.8 percent in November, and nonfarm payroll employment was little changed (+39,000), the U.S. Bureau of Labor Statistics reported today.

David Leonhardt at NYT:

Overall employment growth fell to 39,000, from 172,000. Private-sector hiring fell to 50,000 — which isn’t nearly enough to keep up with normal population — from more than 100,000 in each of the previous four months. Average hourly pay rose just 1 cent, to $22.75, the smallest gain in five months. The average length of the workweek remained stuck at 34.3 hours.

What’s causing this? No one knows, to be honest. But the most likely suspect is the same one that has been hurting the economy for much of this year. Financial crises do terrible damage, and the economic aftershocks from them tend to last longer and be worse than people initially expect.

Steve Benen:

I realize that economists tend to emphasize that it’s unwise to overreact to any one report, but this one feels like a punch to the gut. For all the indications that the job market was starting to pick up a little steam, this morning’s jobs report suggests the exact opposite.

Ryan Avent at Free Exchange at The Economist:

There is little to be happy about in this report, in other words. But there are some indications that the November numbers may be an aberration. September’s job losses were revised down to 24,000 in this report, while October’s job gains were revised upward, from 151,000 to 172,000. Through November, weekly data on initial jobless claims showed significant improvement. And of course, many other indicators have been flashing positive signs in recent weeks.

It’s likely, then, that the November figures will be revised up in future months to show a better performance more in keeping with broader trends. And it’s important to remember that monthly data are noisy. America’s labour markets have yet to generate job growth sufficient to bring down the unemployment rate. But the pace of recovery has been improving. There is good reason to suspect that when all is said and done this report will appear as a blip marring a strengthening upward employment trend. All the same, policymakers in Washington weighing whether to extend unemployment benefits and tax cuts should heed the obvious weakness in labour markets. They can and should make sure that November’s number remains an anomaly.

Don Suber:

Unemployment rose to 9.8% in November — or a full two points higher than what Barack Obama said it would be if we had done nothing.

One year ago, unemployment was at 10%, which proves Obamanomics has stalled the economy, as there was a net gain of only 39,000 jobs this November.

President Obama can no longer blame President Bush for this mess. Obama has spent record amounts of money and increased the size of the federal government from being 20% of the economy under Bush to now 25% of the economy as he increased the budget from $2.8 trillion a year to $4 trillion.

He has failed.

He is a failure, America.

Nice guy, but a failure none the less.

But he did ban Four Loko.

Philip Klein at the American Spectator

John Cole:

Just a reminder. The Republicans, energized over their November victories, went to Washington and immediately went about securing tax cuts for millionaires and billionaires as priority #1, all while blocking any attempts at job growth legislation and continuation of unemployment benefits. Meanwhile, this is happening:

[…]

A competent political party would be able to make the Republicans pay a political price for this and be forced to make very uncomfortable votes. Does anyone know where I can find a competent political party?

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Filed under Economics, The Crisis

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