From Mish's Global Economic analysis site:
(http://www.globaleconomicanalysis.blogspot.com)
Hmmm 90,000 of the assumed jobs were in Leisure and Hospitality. This category includes food services. Yeah, that is going to support a lot of purchasing power.
How does the BLS go about guessing these numbers? Well it looks at the economy and says well historically we add such and such number of jobs in a "typical recovery" blah blah blah as if this train wreck has anything to do with a typical recovery.
What is interesting about the assumed jobs this month is that the GDP for the 1st quarter of 2004 was +4.1% while the GDP for the 1st quarter of 2005 was +3.1%. Last April we added 225,000 jobs and this April in spite of a lower GDP we assumed a "mere" 257,000 jobs. Thanks to John Succo at Minyanville for pointing that out.
Also interesting is that the BLS Household Survey showed an increase of 598,000 jobs. Does anyone really believe that? What did we do, add another 500,000 people selling stuff on EBAY as their job?
In the Establishment Survey we see that leisure and hospitality gained 58,000 jobs in April, including 35,000 in food services and drinking places. Since June 2002, employment in leisure and hospitality has expanded by 823,000 with four-fifths of the gain occurring in food services. This trend is clear, we are outsourcing manufacturing and adding bartenders, waiters, and greeters at Walmart.
Also note that according to BLS table A-12 (about the only place one has any inkling of what the employment situation might be, alternative measures of unemployment are still at 9%. That number is probably much closer to reality but with all the obvious shenanigans, who really knows for sure what the real rate is.
Finally I would be remiss if I failed to point out the BLS reported that for the 31st month in a row, more than 20% unemployed had been out of work longer than six months. Is that consistent with creating 589,000 jobs? |
