Jobless rate dips to 9.1%, 117K jobs added in July; Update: Dip comes from labor force exodus

posted at 8:44 am on August 5, 2011 by Ed Morrissey

The US economy produced a net gain of 117,000 jobs in July, cutting the jobless rate a tenth of a point to 9.1%, according to today’s report from the Bureau of Labor Statistics.  That beats economists’ predictions of a net gain of 85,000 jobs and maintaining the 9.2% jobless rate from June.  The news comes as a welcome, if very mild, positive surprise after yesterday’s falloff on Wall Street.

Unfortunately, the government reporting sites were down this morning, so I’ll update in a little bit with the numbers.  However, a Reuters headline from earlier in the morning captured the essence of the reporting on today’s figures: “Make or break jobs report as markets fear recession.”  If they expected the numbers today to ease those fears, they will come away disappointed.  While this job creation number is the best we’ve seen in a few months, it barely makes the maintenance level — the number of jobs we have to add to keep up with population growth.  The fall in the jobless rate moves the number in the right direction, but only if it didn’t come from more flight of workers from the workforce.

Reuters also notes at the same link (the headline has changed) that May and June numbers were revised to add 56,000 more additional jobs in those months:

U.S. job growth accelerated more than expected in July as private employers stepped up hiring, a development that could ease fears theeconomy was sliding into a fresh recession.

U.S. payrolls increased 117,000, the Labor Department said on Friday, above market expectations for an 85,000 gain. The unemployment rate dipped to 9.1 percent from 9.2 percent in June, but this was mostly the result of people leaving the labor force.

The payrolls count for May and June was revised to show 56,000 more jobs added than previously reported

The report was the first encouraging piece of economic data in some time.

Again, it’s only “encouraging” in the sense that it wasn’t overtly discouraging.  An addition of 117K net jobs is a sideways move, not an advance, except in the sense that it wasn’t backward.  It’s not a number that will encourage an increase in demand, although it won’t curtail demand, either.  It’s a stagnation number, especially given the chronically high unemployment that we have seen over the last three years.

National Journal’s report takes the correct approach:

The United States picked up 117,000 jobs in July and revised upward another 56,000 jobs from May and June — two bright spots after an awful week of economic news. Dow futures jumped about 100 points. The unemployment rate fell slightly to 9.1 percent.

The Labor Department report provided a slight boost to a stumbling economy.

I’d quibble about the “brightness” of these spots, but they do stand out at the end of a very bad week, and “slight” is exactly correct.  It beats 9.3% and 40,000 jobs added, which was my guess, or 9.2% and 85,000 net jobs, which was the consensus of economists — but not by all that much.

Update: According to Bloomberg, the decline in the jobless rate comes from a decline in the work force:

Payrolls rose by 117,000 workers after a 46,000 increase in June that was more than originally estimated, Labor Department data showed today in Washington. The median estimate in a Bloomberg News survey called for a July gain of 85,000. The jobless rate dropped to 9.1 percent as more Americans left the labor force, while average hourly earnings climbed 0.4 percent.

That’s one reason why the actual report comes in handy — and why the BLS servers should have been bolstered for the traffic today.

Update II: More from Bloomberg:

The jobless rate declined as 193,000 people left the labor force and the number of unemployed dropped by 156,000. The share of the eligible population holding a job declined to 58.1 percent, the lowest since July 1983.

Don’t expect much cheering over this report on Wall Street, even if you hear it from Pennsylvania Avenue.

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just another bump in the road

cmsinaz on August 5, 2011 at 10:08 AM

I also mentioned yesterday the “automatic” trading nature of the NYSE form just 10 years ago… 80% compared to 20% then.

In addition – the NYSE/Euronet 2007 merger is why</b< it reacted they way it did. Its directly tied in theorugh bid/ask – automatic buy and sell triggers, like buy stop/sell stop execution.

What that means folks – is when a $1 stock hits $1.20 – and a computer automatically triggers a "sell", whereas a buyer kicks in (unless you have a really low float or volume). We are talking about millions of shares multiplied by hundreds or thousands of holders or traders.

Thats why the dominoe effect of "OMG!!!" occurs – because it was calculated months earlier.

Odie1941 on August 5, 2011 at 10:08 AM

Oil down, indices down, gold up.

andy85719 on August 5, 2011 at 10:09 AM

Oil down, indices down, gold up.

andy85719 on August 5, 2011 at 10:09 AM

G. Gordon Liddy likes this trend.

teke184 on August 5, 2011 at 10:09 AM

That’s one reason why the actual report comes in handy — and why the BLS servers should have been bolstered for the traffic today.

Ed, I think you’re assuming the “server not available” was an error. No, I think it was by design, simply so that the instant headlines would say “unemployment drops to 9.1%” instead of “BLS reports decline in job seekers; unemployment rate drops to 9.1% due to less workers looking for a job”.

BobMbx on August 5, 2011 at 10:15 AM

the decline in the jobless rate comes from a decline in the work force:

Good time to cue up Ginger Rogers singing “We’re in the Money” in Pig Latin:

http://www.youtube.com/watch?v=QUBftlqlF3w

Dr. Carlo Lombardi on August 5, 2011 at 10:15 AM

Odie,

Yesterday my wife told me that a lot of her friends on Facebook were freaking out that the stocks market dropped. I asked her, why are they freaking out, your friends are in their 20s and 30s, they won’t need their retirement money for at least 25 years? She said, I dunno, they are all freaking out.

angryed on August 5, 2011 at 10:04 AM

There is a reason why reatil brokerages make billions a year. I used to be one of them. If you want an accurate portrayal of the dirty retail and underwriting world – watch Boiler Room.

Heres the deal – we had a script (ahem couldnt be on your desk when you pitched a stock, ahem…) that went through 6 closing cycles. It was designed and made based on the ignorance of the “investor”, while taking advantage of the perception “you are a loaded broker who knows all and earns $1m a year through brilliance”

All dangerous BS. The highest earners, were the dumbest people – because they were monkeys with no integrity who just “got rich” Think Vin Diesels role.

IN order to become a broker and take the Series 7, 63, etc – you need to be 18 and no criminal record.

That is the requirement. Thats it.

Now when retail online trading came about – it was positioned as “letting investors decide” and most importantly – to combat the rogue Boiler Rooms and IB’s who were pumping and dumping house stock, while losing peoples money. The amount of SEC actions against brokers peaked in the 1980′s-1990′s.

So – in effect – the gov allowed people to throw any money at stocks, without an iota of knowledge. Now dont get me wrong, there are some smart, money making market everyday people out there, but the large majority (spitt balling 80-85%) are like your wifes friends – they check a few boxes at work when the “Financial Advisor” shows up to establish their 401k and hopefully – at least, read their quarterly/annual reports. OR they go to http://www.giveyoumymoney and lose everything.

Notice how we dont hear too much about “day traders” anymore… their broke.

The majority of people throw their money at hope, which creates the trillion dollar slush funds for traders.

Odie1941 on August 5, 2011 at 10:19 AM

Unemployment figures are so fluxed up that the actual percentage of the population that do not have jobs is extremely hard to overcome without some dramatic action.

But what is even more sad, determining the actual number requires counting those, who according rules cut off, I mean really how disheartening it must be to

MSGTAS on August 5, 2011 at 10:31 AM

Ed –

Within the “jobless rate decline due to decline in workforce” what is the “trigger” that determines if someone is no longer reciving benefits?

Are they 99 weekers who have run out OR do they calculate payments not going out to people, who are still unemployed and still qualify – but didnt get a check for a few weeks due to either making money (freelance) or temp work, whereas you still can keep and recieve benefits?

Odie1941 on August 5, 2011 at 10:36 AM

Are we going to finally get some Obamavilles?

http://hamptonroads.com/2011/08/va-beach-ponders-approving-homeless-tent-city

Cindy Munford on August 5, 2011 at 10:38 AM

This is like being in a baseball game where you’re down 20-0, and you hit a grand slam to make it 20-4.

WOW!

Good Lt on August 5, 2011 at 8:54 AM

..if only. More like bases full 1-out sac fly to narrow the score to 20-1.

The War Planner on August 5, 2011 at 10:42 AM

Odie,

Yesterday my wife told me that a lot of her friends on Facebook were freaking out that the stocks market dropped. I asked her, why are they freaking out, your friends are in their 20s and 30s, they won’t need their retirement money for at least 25 years? She said, I dunno, they are all freaking out.

angryed on August 5, 2011 at 10:04 AM

I’m 31. Retirement is, frankly, another 30 years away for me, at least.

I’m sufficiently spooked by the way things are going that over the course of remainder of the year, I’m going to be opening up my savings and pouring money from it, into paying off my student loan debt. It’s the only significant debt I have, and I’ve heard all of the reasons / excuses why I shouldn’t do this (“But loan debt is okay! It won’t affect your credit rating!”).

Don’t care. The financial apocalypse is steadily approaching. When it hits, I want to owe as few people as possible, as little as possible. Not that I would ever do it – I’m too much of a city boy to go live in the wilds or anything – but I want the option of being able to go “off the grid” if I have to, with no debt to tie me down.

Vyce on August 5, 2011 at 10:57 AM

Vyce on August 5, 2011 at 10:57 AM

Smart man. I moved everything to fixed years ago, sans about $10k in equities.

I’ll take a guaranteed 2-3% over 30 years anyday.

Just like when I go to Vegas. I dont gamble, I play cards, win – then walk away…

Odie1941 on August 5, 2011 at 11:04 AM

I’m sorry, but I just don’t believe these numbers. In fact, I don’t believe anything our Government tells me anymore.

Knucklehead on August 5, 2011 at 11:06 AM

Cindy Munford on August 5, 2011 at 10:38 AM

There are a number of Obamavilles already in existence. One had a very large sign labeling the site as such.

dogsoldier on August 5, 2011 at 11:27 AM

Ed…

… What’s the over/under when the numbers will be “revised” next week?

Seven Percent Solution on August 5, 2011 at 11:47 AM

Without including the amount of people that have exhausted their unemployment benefits, those who have stopped looking for work, and those underemployed…

… It’s like calculating inflation without including the cost of gas and food.

Pure propaganda by our liberal elite political ruling class to keep the sheeple from revolting…

Seven Percent Solution on August 5, 2011 at 11:52 AM

Don’t care. The financial apocalypse is steadily approaching. When it hits, I want to owe as few people as possible, as little as possible. Not that I would ever do it – I’m too much of a city boy to go live in the wilds or anything – but I want the option of being able to go “off the grid” if I have to, with no debt to tie me down.

Vyce on August 5, 2011 at 10:57 AM

This is precisely why I’ve refused to take out any student loans…even though it means getting “discount knowledge at the community college”, as the song goes. Waaay the hell better than owing tens of thousands that I won’t be able to pay off for decades. The job situation is still hopeless, but at least I won’t be fearing the repo man.

Unfortunately, there’s nothing my parents can do about their mortgage, and if pop loses his job the family is screwed. But unless I stumble over a winning lottery ticket or the like…nothing I can do about that. 8′-{

Uncle Sams Nephew on August 5, 2011 at 11:56 AM

For myself I will wait another month for the corrections to whatever Obama puts out for figures. I am sure you all have noticied good figures followed by a delay then corrections downward. No truth here. Let the party roll on for the Obama’s NOT. His family vacations and flies all over and lives well while we and our friends struggle to keep ourselfs together and loosing whatever we have saved.

Release on August 5, 2011 at 12:02 PM

http://data.bls.gov/timeseries/LNS12300000

Population-Employment Ratio for July? 58.1% of the country has a job.

Most recent month that low or lower? July 1983.

So the number is still dropping, more than a 25 year low for employment in this country as a percentage of the population.

Is this what a recovery looks like now?

gekkobear on August 5, 2011 at 12:03 PM

Funemployment! You guys just don’t understand that this is a chance for people to relax, vacation, have a good time, eat more government cheese….

Django on August 5, 2011 at 12:18 PM

Seems like a good time to put forth a bill killing all governmental involvement in FM/FM.

teke184 on August 5, 2011 at 9:47 AM

Never going to happen, Fannie and Freddie are the golden goose for democratics. It’s a cushy place for a democratic to go into semi-retirement after leaving the government trough. Private and corrupt enough that they can make a killing, public enough for guaranteed bailouts.

slickwillie2001 on August 5, 2011 at 12:33 PM

There are a number of Obamavilles already in existence. One had a very large sign labeling the site as such.

dogsoldier on August 5, 2011 at 11:27 AM

Yes, many cities have them. They are just not a politically-correct topic to report on with a democratic in the Oval Office.

slickwillie2001 on August 5, 2011 at 12:34 PM

just another bump in the road

cmsinaz on August 5, 2011 at 10:08 AM

After this many ‘bumps in the road’, don’t you have to look to the driver of the car and ask “are you sure we are on a road?”

slickwillie2001 on August 5, 2011 at 12:35 PM

teenagers (25.0 percent)
blacks (15.9 percent)
Hispanics (11.3 percent)

My goodness this guy is shafting the stuffing out of his key demographics and they are enthusiastically stickering up their bumpers with “2012″ decals.

Greek Fire on August 5, 2011 at 12:42 PM

Don’t care. The financial apocalypse is steadily approaching. When it hits, I want to owe as few people as possible, as little as possible. Not that I would ever do it – I’m too much of a city boy to go live in the wilds or anything – but I want the option of being able to go “off the grid” if I have to, with no debt to tie me down.

Vyce on August 5, 2011 at 10:57 AM

I agree with you at heart. But logically, I’d run up all my debt buying guns and ammo. When the crash comes, all debts are gone. The companies you owe it to will be dead.

“Marines, we are leaving.”

orbitalair on August 5, 2011 at 12:55 PM

Obama will blame Michelle Obama and his kids in order to get reelected.

Schadenfreude on August 5, 2011 at 2:03 PM

Amazing how a market crisis goes away in less than 24 hours

Artificial nonsense from the word “go”.

Odie1941 on August 5, 2011 at 2:12 PM

Pure propaganda by our liberal elite political ruling class to keep the sheeple from revolting…

Seven Percent Solution on August 5, 2011 at 11:52 AM

Yes it is. Failbama’s clowns arbitrarily removed 193,000 people from the number used to represent the US Workforce. That’s the only way they can keep the U3 percentage going down and they have done this repeatedly, despite the fact that those people are still looking for work.

There are no jobs.

dogsoldier on August 5, 2011 at 2:23 PM

orbitalair on August 5, 2011 at 12:55 PM

Don’t forget MREs and canned peaches.

dogsoldier on August 5, 2011 at 2:25 PM

Food stamps and welfare pimp

Schadenfreude on August 5, 2011 at 2:34 PM

Real unemployment at 40%. Sounds about right.

BierManVA on August 5, 2011 at 9:12 AM

Exactly. Of course they also don’t take into account small business owners/sole proprietors who have lost their shirts and aren’t eligible for unemployment benefits. We’re off all grids.

During this failed socialist experiment, I have worked harder to find work, worked harder at the work I have found, lost more business and earned less money than in any period in my life. I know many formerly very successful business people who have lost everything – and I do mean everything. For example, a successful appraiser has lost her 4,000 sq. ft. house, sold all belongings, and will now live in a 13′ travel camper. God knows how she’ll pay for gas, food. . .

My heart breaks for soo many people who are suffering. It is dire.

If we don’t get rid of the Marxists in charge. . .fill in the blank.

Sorry, these latest numbers do not reflect reality.

Opinionator on August 5, 2011 at 3:32 PM

Has Hotair retired the pretty young blood on the cellphone in the long unemployment line?

SC.Charlie on August 5, 2011 at 4:07 PM

She became discouraged and fell out of the labor force.

DKCZ on August 5, 2011 at 4:25 PM

Oil down, indices down, gold up. – andy85719 on August 5, 2011 at 10:09 AM

Has gold every paid a dividend?

SC.Charlie on August 5, 2011 at 6:09 PM

Let’s keep something very important in mind here. All these numbers do not include or have any thing to do with those of us that are self employed. We are not reported, accounted or
receive any type of Government help, yet the political are the first to say we are the corner stone of the economy. Last year I lost everything, contracts, business and about $150,000/year. What do you do? Simple, go out and push hard to make a living. One year later and I’m a little better then holding my own. By the end of the year I’ll be close to where I was.

jpcpt03 on August 5, 2011 at 6:22 PM

Per marketwatch.com:

The Stock Market did something historical yesterday, something it had not done for 323 years: it has now experienced a decline for 9 straight sessions:

The last time the Dow Jones Industrial Average DJIA, -4.31%, did that, in fact, was Feb. 22, 1978, when Jimmy Carter was president and the country was struggling to come to grips with a period of anemic economic growth and high inflation.

Isn’t it comforting to know that we’ve made such progress over the last three decades?

kingsjester on August 5, 2011 at 6:25 PM

Um, how much will this get raised when the inevitable correction comes?

{^_^}

herself on August 6, 2011 at 3:36 AM

The picture on the home page gave me a thought (perfect just before The Won’s bus tour) every city/town puts a simple request out (yes, even using the alphabet networks & local ‘news’papers) – Bring a homemade Need Work sign to (City Hall, whatever) 0n such & such a morning and send the resulting photo to The Won (and of course local media – and HA). I think that the resulting photos would have massive impact on the voters, on the crapweasels (Congress) in DC and mostly make a point at how The Won IS NOT focused on jobs at all.

jackal40 on August 6, 2011 at 9:24 AM

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