Gallup’s latest measure of US unemployment shows joblessness rising through the first part of the month, with underemployment remaining at exactly the same level as 2010. The mid-month survey provides a leading indicator for the official jobless report that will come in the next two and a half weeks, and so far it doesn’t look like it will bring much good news to the White House:
Unemployment, as measured by Gallup without seasonal adjustment, is at 8.9% in the middle of July — up from 8.7% at the end of June. Unemployment was at 9.3% at this same time a year ago.
The percentage of part-time workers who want full-time work is 9.4% in mid-July — down from 9.6% at the end of June. However, more Americans are working part time but seeking full-time work in mid-July 2011 than was the case in mid-July 2010 (9.0%).
Underemployment, a measure that combines the percentage of unemployed with the percentage working part time but wanting full-time work, is at 18.3% in mid-July — precisely the same as at the end of June and in mid-July 2010.
Gallup reports that this represents “an early July deterioration” in employment, but doesn’t offer much beyond speculation for the cause. The pollster suggests that employers might be hedging their bets because of the debt negotiations and the uncertainty of whether the US might default, but initial jobless claims jumped in early April before this issue became acute — a dynamic that Gallup’s survey misses entirely, by the way. The report also posits that a decline in demand might be driving an uptick in unemployment, and for that, there is some new corroboration from the oil markets today:
Oil prices slipped below $97 a barrel on Monday as weakening U.S. consumer confidence and more signs of financial stress in Europe renewed concerns about demand for crude.
By early afternoon in Europe, benchmark oil for August delivery was down 80 cents to $96.44 a barrel in electronic trading on the New York Mercantile Exchange. Crude rose $1.55 to settle at $97.24 on Friday.
In London, Brent crude fell 52 cents to $116.74 per barrel on the ICE Futures exchange.
Considering the beating that the dollar took last week, the price drop is remarkable. It seems that the world is bracing for another recession based on the latest economic indicators, perhaps especially the drop in consumer confidence. It’s not exactly surprising that unemployment would rise as a result. If Gallup’s results show up in the jobless report for July, it will further hamper Obama’s efforts to stay the course with his economic and regulatory policies.