US unemployment rate rises to 9.9%

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Icarus27k

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But 290,000 jobs were added during the month of April, more than expected.

What's the dealio? How can the US be adding a lot of jobs, but the unemployment rate rise? It's an increase in labor force participation. Discouraged workers (that is, unemployed people who have given up on looking for a job) are not counted in the unemployment rate. Right now, they are re-entering the job hunt because they are becoming encouraged that they can actually find a job. They go from being the invisible unemployed to being counted as unemployed.

Source: CBC News - Money - U.S. economy adds 290,000 jobs
 
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Icarus27k

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The 290,000 number is preliminary. It'll be revised, probably upward just like the numbers for the past two months were. That's getting close to that 500,000 jobs added each month number I've mentioned here at CC before.
 
SirJosephPorter

SirJosephPorter

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This increase in unemployment is good news. The increase is not caused by more people being thrown out of work, the economy created significant number of more jobs. What this increase means is that people are beginning to feel optimistic about the economy once again, and have started looking for jobs, while they had given up a few months ago.

In a recession, unemployment increases in the beginning and in the end. In the beginning, because more and more people are thrown out of work, the economy is losing jobs. In the end, because while the economy is creating jobs, people are reentering the job market at even a bigger rate.

So I would say this is good news on both fronts. Creation of a large number of new jobs tells us that economy indeed is on the way to recovery. Increase in unemployment tells us that people are beginning to feel more optimistic about the economy, about their prospects, and are reentering the job market.
 
Walter

Walter

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Icarus27k said:
The 290,000 number is preliminary. It'll be revised, probably upward just like the numbers for the past two months were. That's getting close to that 500,000 jobs added each month number I've mentioned here at CC before.
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Got a link for the revised numbers for Feb. and Mar. 2010?
 
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Avro

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SirJosephPorter said:
This increase in unemployment is good news. The increase is not caused by more people being thrown out of work, the economy created significant number of more jobs. What this increase means is that people are beginning to feel optimistic about the economy once again, and have started looking for jobs, while they had given up a few months ago.

In a recession, unemployment increases in the beginning and in the end. In the beginning, because more and more people are thrown out of work, the economy is losing jobs. In the end, because while the economy is creating jobs, people are reentering the job market at even a bigger rate.

So I would say this is good news on both fronts. Creation of a large number of new jobs tells us that economy indeed is on the way to recovery. Increase in unemployment tells us that people are beginning to feel more optimistic about the economy, about their prospects, and are reentering the job market.
Click to expand...

Would you put so positive a spin on this if McCain was president?

Highly unlikely.
 
SirJosephPorter

SirJosephPorter

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Avro said:
Would you put so positive a spin on this if McCain was president?

Highly unlikely.
Click to expand...

I most certainly would. This is not a spin, this is how a classic recession behaves. The first to recover is the stock market, it did that months ago. Then company profits, company orders increase, that has also happened. As companies make more profit and as their orders increase, they hire more staff, that is the last indicator to recover.

Increase in number of jobs created is the second last piece in the recovery puzzle, unemployment (percentage wise) is the last. Unemployment should start dropping in the next few months (it may even be as early as next month).
 
petros

petros

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SirJosephPorter said:
I most certainly would. This is not a spin, this is how a classic recession behaves. The first to recover is the stock market, it did that months ago. Then company profits, company orders increase, that has also happened. As companies make more profit and as their orders increase, they hire more staff, that is the last indicator to recover.

Increase in number of jobs created is the second last piece in the recovery puzzle, unemployment (percentage wise) is the last. Unemployment should start dropping in the next few months (it may even be as early as next month).
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Which industries are keeping the markets alive to rebound from this recession?
 
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YukonJack

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According to some all-knowing sage here, the higher the unemployment rate the better the news. (Post #6)

So, let us strive for and reach perfect Nirvana: 100% unempoyment.
 
SirJosephPorter

SirJosephPorter

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petros said:
Which industries are keeping the markets alive to rebound from this recession?
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Oh, I don't know petros, I am sure it could be easily obtained from internet. I can think of GM for one. But I also remember that only a small portion of these jobs (may be 50 or 60,000) were government jobs, the rest were private sector jobs. So the job increase is not due to stimulus, it is a real increase in jobs.
 
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Avro

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YukonJack said:
According to some all-knowing sage here, the higher the unemployment rate the better the news. (Post #6)

So, let us strive for and reach perfect Nirvana: 100% unempoyment.
Click to expand...

It's good news if you are concerned about interest rates...otherwise...not so good.
 
SirJosephPorter

SirJosephPorter

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YukonJack said:
According to some all-knowing sage here, the higher the unemployment rate the better the news. (Post #6)

So, let us strive for and reach perfect Nirvana: 100% unempoyment.
Click to expand...

When economy has created a substantial number of new jobs and there is also an increase in unemployment that indeed is good news. That means that people are feeling optimistic about the economy, about their individual prospects and so have again started looking for jobs.

If economy had lost jobs instead of creating jobs and there had been an increase in unemployment, that would be bad news. But as it is, increase in unemployment is a sign that people are feeling optimistic about the future (that is why they decided to reenter the job market).
 
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