It would have been nice if the jobs report this morning was simple, containing only surprises to the upside. But of course, the jobs market continued to show weakness as the August nonfarm report showed. The unemployment rate rose from 9.4% in July to 9.7% last month, the highest since June 1983. Meanwhile, employers cut a net total of 216,000 nonfarm jobs.
The unemployment rate was above economists' expectations of 9.5%, but the payroll decline below their projections for a cut of 225,000 jobs. For now, stock futures are still higher, indicating markets could at least start the session on a positive note.
No doubt, the pace of job losses has slowed from months of over half a million payroll declines, to less than a quarter million. But the economy is still shedding jobs and unemployment is naturally still rising. In fact, economists and the Federal Reserve expect the unemployment rate to top 10% by the end of this year as businesses won't start hiring before a firm recovery is seen and felt.
More than that, the AP says the so-called underemployment rate, which laid-off workers who have settled for part-time work or have given up looking for new jobs , reached 16.8%, the highest on records dating from 1994. Since the recession started, a net total of 6.9 million jobs were lost and14.9 million Americans are unemployed.
Other economic data has been somewhat positive recently, prompting officials to say the economy is expected to be in recovery now, but warning it will be slow and painful. While employment is seen as a lagging, not leading, indicator, it's hard to convince the unemployed the recovery is in motion as they likely feel only the "slow and painful" part of that.
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