Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
Dow Jones Stock Market Topping Pattern - 20th Mar 19
Gold Stocks Outperform Gold but Not Stocks - 20th Mar 19
Here’s What You’re Not Hearing About the US - China Trade War - 20th Mar 19
US Overdosing on Debt - 19th Mar 19
Looking at the Economic Winter Season Ahead - 19th Mar 19
Will the Stock Market Crash Like 1937? - 19th Mar 19
Stock Market VIX Volaility Analysis - 19th Mar 19
FREE Access to Stock and Finanacial Markets Trading Analysis Worth $1229! - 19th Mar 19
US Stock Markets Price Anomaly Setup Continues - 19th Mar 19
Gold Price Confirmation of the Warning - 18th Mar 19
Split Stock Market Warning - 18th Mar 19
Stock Market Trend Analysis 2019 - Video - 18th Mar 19
Best Precious Metals Investment and Trades for 2019 - 18th Mar 19
Hurdles for Gold Stocks - 18th Mar 19
Pento: Coming QE & Low Rates Will Be ‘Rocket Fuel for Gold’ - 18th Mar 19
"This is for Tommy Robinson" Shouts Knife Wielding White Supremacist Terrorist in London - 18th Mar 19
This Is How You Create the Biggest Credit Bubble in History - 17th Mar 19
Crude Oil Bulls - For Whom the Bell Tolls - 17th Mar 19
Gold Mining Stocks Fundamentals - 17th Mar 19
Why Buy a Land Rover - Range Rover vs Huge Tree Branch Falling on its Roof - 17th Mar 19
UKIP Urged to Change Name to BNP 2.0 So BrExit Party Can Fight a 2nd EU Referendum - 17th Mar 19
Tommy Robinson Looks Set to Become New UKIP Leader - 16th Mar 19
Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - 16th Mar 19
Towards the End of a Stocks Bull Market, Short term Timing Becomes Difficult - 16th Mar 19
UKIP Brexit Facebook Groups Reveling in the New Zealand Terror Attacks Blaming Muslim Victims - 16th Mar 19
Gold – US Dollar vs US Dollar Index - 16th Mar 19
Islamophobic Hate Preachers Tommy Robinson and Katie Hopkins have Killed UKIP and Brexit - 16th Mar 19
Countdown to The Precious Metals Gold and Silver Breakout Rally - 15th Mar 19
Shale Oil Splutters: Brent on Track for $70 Target $100 in 2020 - 15th Mar 19
Setting up a Business Just Got Easier - 15th Mar 19
Stock Market Elliott Wave Analysis Trend Forercast - Video - 15th Mar 19
Gold Warning - Here Are the Stunning Implications of Plunging Gold Price - Part 1 - 15th Mar 19
UK Weather SHOCK - Trees Dropping Branches onto Cars in Stormy Winds - Sheffield - 15th Mar 19
Best Time to Trade Forex - 15th Mar 19
Why the Green New Deal Will Send Uranium Price Through the Roof - 14th Mar 19
S&P 500's New Medium-Term High, but Will Stock Market Uptrend Continue? - 14th Mar 19
US Conservatism - 14th Mar 19
Gold in the Age of High-speed Electronic Trading - 14th Mar 19
Britain's Demographic Time Bomb Has Gone Off! - 14th Mar 19
Why Walmart Will Crush Amazon - 14th Mar 19
2019 Economic Predictions - 14th Mar 19
Tax Avoidance Bills Sent to Thousands of Workers - 14th Mar 19
The Exponential Stocks Bull Market Explained - Video - 13th Mar 19
TSP Recession Indicator - Criss-Cross, Flip-Flop and Remembering 1966 - 13th Mar 19
Stock Investors Beware The Signs Of Recession / Deflation - 13th Mar 19
Is the Stock Market Still in a Bear Market? - 13th Mar 19
Stock Market Trend Analysis 2019 - 13th Mar 19
Gold Up-to-Date' COT Report: A Maddening Déjà Vu - 12th Mar 19
Save Fintech? Ban Short Selling. It's Not That Simple - 12th Mar 19
Palladium Blowup Could Expose Scam of Gold & Silver Futures - 12th Mar 19
Next Recession: Concentrating Future Losses & Bringing Them Forward In Time As Profits - 12th Mar 19
The Shift of the Philippine Peso Regime - 12th Mar 19
Theresa May BrExit Back Stab Deal Counting Down to Resignation, Tory Leadership Election - 12th Mar 19

Market Oracle FREE Newsletter

Stock and Finanacial Markets Trading Analysis Worth

U.S. October Employment Situation Means Fed Can Watch From the Sidelines, For Now

Economics / Unemployment Nov 05, 2011 - 03:50 AM GMT

By: Asha_Bangalore


Diamond Rated - Best Financial Markets Analysis ArticleCivilian Unemployment Rate: 9.0% in October, down from 9.1% in September. Cycle high jobless rate for the recent recession is 10.1% in October 2009.

Payroll Employment: +80,000 jobs in October vs. +158,000 in September. Private sector jobs increased 104,000 after a gain of 191,000 in September. Addition of 102,000 jobs after revisions to payroll estimates of August and September

Private Sector Hourly Earnings: $23.19 in October vs. $23.14 in September; 1.8% y-o-y increase in October vs. 1.9% gain in September.

Household Survey – The unemployment rate edged down to 9.0% in October from 9.1% in September. The broad measure of unemployment fell to 16.2% from 16.5% in September. The broad measure of unemployment is a sum of the officially unemployed plus those working part-time because they cannot find full-time jobs and those who want to work but have not looked for a job in the past year.

Fewer teenagers were unemployed in October (24.1% vs. 24.6% in September) and the jobless rate of folks in the 20-24 years age group also fell in October (14.0% vs. 14.7% in September, see Chart 2). The unemployment rate of workers aged 25 years and over has held steady for four straight months at 7.8% (see Chart 3). These data emphasize that the improvement in the jobless rate is concentrated in two categories and it is not broad based.

Another interesting aspect of the October employment report is that part-time employment fell but the number of self-employed rose, such that it accounted for a large part of the improvement in employment (see Chart 4). Thus, the household survey indicates that teenagers, self-employed, and those aged 20-24 years made up the increase in employment during October.

Establishment Survey – Nonfarm payroll employment increased 80,000 in October, following upward revisions to estimates of employment in August and September. The upward revisions added 102,000 new jobs. In the past twelve months, payroll employment averaged 129,000, which is sufficient to match the increase in the labor force but inadequate to make a dent in the current soft status of the labor market.

Highlights of changes in payrolls during October 2011:

Construction: -20,000 vs. +27,000 in September
Manufacturing: +5,000 vs. -3,000 in September
Private sector service employment: +104,000 vs. +191,000 in September
Retail employment: +18,000 vs. +13,000 in September
Professional and business services: +32,000 vs. +50,000 in September
Temporary help: +15,000 vs. +21,100 in September
Financial activities: +4,000 vs. -5,000 in September
Health care: +11,600 vs. +45,000 in September
Government: -24,000 vs. -33,000 in September

The average workweek held steady and hourly earnings rose 5 cents to $23.19 in October, putting the year-to-year change at 1.8%. The contained trend of hourly earnings is not supportive of the inflationary concerns of the hawks in the FOMC. The increase in employment and earnings bodes positively for an increase in the wage and salary component of personal income in October. The 0.5% increase in the manufacturing man-hours index, after a string of three consecutive monthly readings that were unchanged, points to a jump in factory production in October.

Conclusion – In the third quarter, real GDP rose at an annual rate of 2.5%. Gains in new home sales and housing starts and a drop in sales of existing homes during September paint a mixed picture of housing market conditions. More recent incoming economic data suggest the U.S. economy is muddling through. In October, auto sales increased and the factory sector chugged along at a lackluster pace according to the ISM manufacturing survey. If this scenario continues to play out in November, there is little reason for the Fed to engage in any new accommodative policies at the December 13 FOMC meeting. The catalyst for additional net asset purchases by the FOMC will likely be weaker exports due to the recession in the eurozone and the growth slowdown in developing economies. These signs should be visible in the early months of 2012 and prompt the Fed’s third round of large-scale asset purchases.

Asha Bangalore — Senior Vice President and Economist

Asha Bangalore is Vice President and Economist at The Northern Trust Company, Chicago. Prior to joining the bank in 1994, she was Consultant to savings and loan institutions and commercial banks at Financial & Economic Strategies Corporation, Chicago.

Copyright © 2011 Asha Bangalore

The opinions expressed herein are those of the author and do not necessarily represent the views of The Northern Trust Company. The Northern Trust Company does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules