U.S. employment picture: A nation goes dark

[FRED]

http://www.itulip.com/images/blskey.gifNation goes dark: U.S. employment picture

Depression not recession. It really is ``different this time.''

This animation of Bureau of Labor Statistics data depicts year over year changes in unemployment across the U.S. every month since the depression officially began in December 2007. States with falling unemployment are shown in light blue while dark blue indicates rising unemployment.

As forecast, unemployment during this depression has since January 2009 been rising in every state in the U.S.

http://www.itulip.com/images/unemployment2007-2009itulip.gif


If we compare that animation of unemployment data to this older one of recessions since the late 1970s we see that even at the worst part of the 1980 t0 1983 recessions unemployment fell in some states even if it was rising in most states.

http://www.itulip.com/images/unemploymentMovie.gif


We are sticking to our forecast of 20% U3 unemployment in the U.S. by the end of 2010.

See also:
Jobs crash arrives on schedule - Eric Janszen (http://www.itulip.com/forums/showthread.php?p=69807#post69807)
Unemployment by industry: Recession or depression? - Eric Janszen (http://www.itulip.com/forums/showthread.php?p=59666#post59666)
Six Questions for Eric Janszen on the Economic Collapse (http://www.itulip.com/forums/showthread.php?p=55057#post55057)
Unemployment on the rise as economic hard times continue (http://www.thetakeaway.org/stories/2008/oct/28/unemployment-on-the-rise/)

iTulip Select (http://www.itulip.com/forums/showthread.php?t=1032): The Investment Thesis for the Next Cycle™
__________________________________________________

To receive the iTulip Newsletter or iTulip Alerts, Join our FREE Email Mailing List (http://ui.constantcontact.com/d.jsp?m=1101238839116&p=oi)

Copyright © iTulip, Inc. 1998 - 2009 All Rights Reserved

All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Nothing appearing on this website should be considered a recommendation to buy or to sell any security or related financial instrument. iTulip, Inc. is not liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. Full Disclaimer (http://www.itulip.com/GeneralDisclaimer.htm)

[zoog]

Top ten as of March 2009 not seasonally adjusted

<table style="border-collapse: collapse; width: 155pt;" width="207" border="0" cellpadding="0" cellspacing="0"><col style="width: 107pt;" width="143"> <col style="width: 48pt;" width="64"> <tbody><tr style="height: 15pt;" height="20"> <td style="height: 15pt; width: 107pt;" width="143" height="20">Michigan </td> <td style="width: 48pt;" width="64" align="right">13.4</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Oregon </td> <td align="right">12.9</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">California </td> <td align="right">11.5</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">South Carolina </td> <td align="right">11.2</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Rhode Island </td> <td align="right">11.1</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">North Carolina </td> <td align="right">10.9</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Indiana </td> <td align="right">10.6</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Nevada </td> <td align="right">10.5</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Kentucky </td> <td align="right">10.3</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Ohio </td> <td align="right">10.1</td> </tr> </tbody></table>
Top ten as of March 2009, seasonally adjusted:

<table style="border-collapse: collapse; width: 165pt;" width="220" border="0" cellpadding="0" cellspacing="0"> <col style="width: 117pt;" width="156"> <col style="width: 48pt;" width="64"> <tbody><tr style="height: 15pt;" height="20"> <td style="height: 15pt; width: 117pt;" width="156" height="20">Michigan </td> <td style="width: 48pt;" width="64" align="right">12.6</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Oregon </td> <td align="right">12.1</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">South Carolina </td> <td align="right">11.4</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">California </td> <td align="right">11.2</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">North Carolina </td> <td align="right">10.8</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Rhode Island </td> <td align="right">10.5</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Nevada </td> <td align="right">10.4</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Indiana </td> <td align="right">10.0</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">District of Columbia </td> <td align="right">9.8</td> </tr> <tr style="height: 15pt;" height="20"> <td style="height: 15pt;" height="20">Kentucky </td> <td align="right">9.8</td> </tr> </tbody> </table>

[MLM]

I'm going to redouble my efforts to discover the location of all nearby "replenishment pods" between now and then. Looks like some replenishing will be in order.

[jk]

i was kind of hoping the 20% prediction was for u6. if u3 is over 20%, then u6 will be over 30! i hope this isn't one of those terribly pessimistic itulip predictions that turns out to have been not gloomy enough. 20% for u3 is truly catastrophic. frightening.

[ThePythonicCow]

i was kind of hoping the 20% prediction was for u6. if u3 is over 20%, then u6 will be over 30! i hope this isn't one of those terribly pessimistic itulip predictions that turns out to have been not gloomy enough. 20% for u3 is truly catastrophic. frightening.
In an odd way, I'd be more concerned if we didn't have massive unemployment.

This fine nation has gotten itself a nasty debt-habit. Right now, our debt supply has been cut off and we're getting the tremors. Either we manage to kick this debt-habit (at least for the generations alive now) which will be a terrible time, or we manage to pump up the debt-bubble engine one more time, which while easier now would be worse when we finally do kick the habit.

Pay me now or pay me later. And don't forget, I'm the Bankster (sung to the tune of the Beatle's "Taxman"), so the unpaid bill continues to accumulate interest.

On the other hand (oh to be the One-Handed Economist, Howard Katz ;)) we'll just be kicking this can down the road either way. The feudal thugs running the world banking system (thanks to Ellen Hodgson Brown for some of those words) continue to strengthen their grasp of the worlds money, hence of its power and politics. The Panic of 2008, and the Depression of 2009++ are but more chapters in that book, the ending to which is nowhere insight.

P.S. -- It seems to be entire bloody world that has a bad debt-habit.

[ThePythonicCow]

I'm going to redouble my efforts to discover the location of all nearby "replenishment pods" between now and then. Looks like some replenishing will be in order.
Would you mind explaining to this ignorant bloke - what's a "replenishment pod"? The only Google hit I got was for a Cuisinart prepackaged coffee pod.

[louzbek]

An interactive map (http://www.slate.com/id/2216238/) of vanishing employment across the US. Sad and scary...

[D-Mack]

i was kind of hoping the 20% prediction was for u6. if u3 is over 20%, then u6 will be over 30! i hope this isn't one of those terribly pessimistic itulip predictions that turns out to have been not gloomy enough. 20% for u3 is truly catastrophic. frightening.

I was thinking the same.

How does it compare to historic examples ? And what are the numbers in millions for the US, is the Labor Force really 150 million or is the gov. working with other numbers for U6?
http://en.wikipedia.org/wiki/List_of_countries_by_labour_force


Weimar had 30% with nearly 6 million unemployed
Unemployment figures rose from 1.39 million / 8.4 % to 1.89 million / 13.1 % in 1929, 3.07 million / 15.3 % in 1930, 4.52 million / 23.3 % in 1931, 5.57 million / 30.1 % in 1932


...

Demography . J. Lahmeyer gives Germany's population for 1929 as 64.7 million, that of 1933 as 66.0 million.
http://www.zum.de/whkmla/region/germany/wr19291932.html

[santafe2]

We are sticking to our forecast of 20% U3 unemployment in the U.S. by the end of 2010.

Is that possible Fred or am I just math challenged today? We're currently at an average of 8.5% unemployment in the US, up 5.1 million since the beginning of the downturn. For that 20% prediction to come true we'll have to see a minimum of an additional 17.6 million unemployed over the next 20 months or an average of ~880,000 additional unemployed each month. I'm assuming a workforce of 153 million.

And the above numbers assume no one currently on the U3 list, or added to the U3 list over the next 20 months becomes discouraged or takes a part time Mc-job. And the U6 rate, the real unemployment rate might be 40% if the U3:U6 ratio stay the same.

I must be counting wrong....right?

[goadam1]

Man, Fred and his wicked sense of humor. Thanks for this one. First I laughed out loud but I was crying the second time. Good one.

[allenjs]

Is that possible Fred or am I just math challenged today? We're currently at an average of 8.5% unemployment in the US, up 5.1 million since the beginning of the downturn. For that 20% prediction to come true we'll have to see a minimum of an additional 17.6 million unemployed over the next 20 months or an average of ~880,000 additional unemployed each month. I'm assuming a workforce of 153 million.

And the above numbers assume no one currently on the U3 list, or added to the U3 list over the next 20 months becomes discouraged or takes a part time Mc-job. And the U6 rate, the real unemployment rate might be 40% if the U3:U6 ratio stay the same.

I must be counting wrong....right?

I think you're counting right. IIRC, iTulip last December was predicting run rate of about a million net new unemployed per month, and there is no reason to believe that we won't see that.

Recovery cannot begin until the cancer is cut out (i.e. zombie banks and shareholders wiped out, toxic "assets" cleared, debt deflated). Unfortunately, the current administration has been procrastinating on taking the necessary painful steps. No net new jobs will be created until some long period after some zombies are killed, and we're not even trying to kill the zombies yet.

Cynical people might suggest that this is A-OK with the ruling plutocrats. If they wipe out the middle class, there is nobody to challenge them for power. Mao, Pol Pot, Castro, and many other great leaders understood this important point. Most of the world's history has been typified by arrangements with a tiny ruling class and a huge underclass.

[goadam1]

People seem to be buying more iphones and ipods than the last depression.

http://www.bloomberg.com/apps/news?pid=20601087&sid=av8qu_RRf.so&refer=home

[stockman]

Interesting PDF here from James Hamilton (Professor of Economics at the University of California, San Diego)

1471

1472

Latest article at Hamilton's Econbrowser here, some here might find it interesting-

The Great Recession Goes Global http://www.econbrowser.com/archives/2009/04/the_great_reces.html

[D-Mack]

People seem to be buying more iphones and ipods than the last depression.

http://www.bloomberg.com/apps/news?pid=20601087&sid=av8qu_RRf.so&refer=home

I think those are worldwide numbers, still more than last year.

Apple's iPod business

Over 11.013 million iPods were sold this quarter, resulting in $1.665 billion in revenue. The sequential decrease is the single largest registered in this quarter's results, plummeting 52 percent in units and 51 percent in revenue. Compared to early 2008, however, units are up 3 percent while revenue is down slightly by 8 percent.

http://www.appleinsider.com/articles/09/04/22/notes_of_interest_from_apples_q209_quarterly_confe rence_call.html

[rabot10]

http://www.itulip.com/images/blskey.gifNation goes dark: U.S. employment picture

Depression not recession. It really is ``different this time.''

This animation of Bureau of Labor Statistics data depicts year over year changes in unemployment across the U.S. every month since the depression officially began in December 2007. States with falling unemployment are shown in light blue while dark blue indicates rising unemployment.

As forecast, unemployment during this depression has since January 2009 been rising in every state in the U.S.

http://www.itulip.com/images/unemployment2007-2009itulip.gif


If we compare that animation of unemployment data to this older one of recessions since the late 1970s we see that even at the worst part of the 1980 t0 1983 recessions unemployment fell in some states even if it was rising in most states.

http://www.itulip.com/images/unemploymentMovie.gif


We are sticking to our forecast of 20% U3 unemployment in the U.S. by the end of 2010.

See also:
Jobs crash arrives on schedule - Eric Janszen (http://www.itulip.com/forums/showthread.php?p=69807#post69807)
Unemployment by industry: Recession or depression? - Eric Janszen (http://www.itulip.com/forums/showthread.php?p=59666#post59666)
Six Questions for Eric Janszen on the Economic Collapse (http://www.itulip.com/forums/showthread.php?p=55057#post55057)
Unemployment on the rise as economic hard times continue (http://www.thetakeaway.org/stories/2008/oct/28/unemployment-on-the-rise/)

iTulip Select (http://www.itulip.com/forums/showthread.php?t=1032): The Investment Thesis for the Next Cycle™
__________________________________________________

To receive the iTulip Newsletter or iTulip Alerts, Join our FREE Email Mailing List (http://ui.constantcontact.com/d.jsp?m=1101238839116&p=oi)

Copyright © iTulip, Inc. 1998 - 2009 All Rights Reserved

All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Nothing appearing on this website should be considered a recommendation to buy or to sell any security or related financial instrument. iTulip, Inc. is not liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. Full Disclaimer (http://www.itulip.com/GeneralDisclaimer.htm)


Fred you guys or girls at iTulip have become optimists, what’s up with that?

rick

[metalman]

why don't americans move? (http://www.itulip.com/forums/showthread.php?p=93661#poststop)

[analog2000]

In the semiconductor industry, jobs are pretty much non existent right now. Never seen anything like this in this sector
analog2000

[goadam1]

Maybe, if the Joads had a better fico score, talf had bailed out the bonds on their credit cards, tarp had kept all the banks going, freddie mac had pushed through a refinance, President Hope had extended unemployment, then they wouldn't have had to migrate.

Todays Joads are home with toxic dry wall and a new kitchen. They get off the couch, from watching "the biggest loser" or "Idol" and mosey to Applebee's, where they put all you can eat shrimp night on the Capitol One card (personalized with a picture of their dog).

Go bubble!

[Sharky]

i was kind of hoping the 20% prediction was for u6.

Using the pre-Clinton methodology for calculating the numbers, U-6 is already close to 20%.

http://www.shadowstats.com/alternate_data

[tragoudistis]

This is a depression like 1929.:eek:
http://static.guim.co.uk/Guardian/business/gallery/2008/apr/14/economics.photography/GD6593838@1929-----Panicked-sto-3157.jpg

[goadam1]

The four week moving average has leveled off. I guess we could see a spike later in the year. But does 650,000 a month add up to 20%?

[Basil]

The four week moving average has leveled off. I guess we could see a spike later in the year. But does 650,000 a month add up to 20%?

If you look at the chart from Slate, the link to which was posted by Luzbek, it appears that the first four months of both 2007 and 2008 were the periods of greatest job growth. If this represents a seasonal pattern, it would imply that the current leveling off is a result of the seasonal pattern and that we are about to start going back down. But I do not know enough to know whether or not the seasonal bump seen in the Slate graph results from a pattern or an anomaly. My guess is that the layoff numbers begin to increase again over the summer. The fact that several companies are choosing not to provide guidance in their earnings reports where they once did does not bode well.

[ax]

If you look at the chart from Slate, the link to which was posted by Luzbek, it appears that the first four months of both 2007 and 2008 were the periods of greatest job growth. Is this represents a seasonal patter, it would imply that the current leveling off is a result of the seasonal pattern and that we are about to start going back down. But I do not know enough to know whether or not the seasonal bump seen in the Slate graph results from a pattern or an anomaly. My guess is that the layoff numbers begin to increase again over the summer. The fact that several companies are choosing not to provide guidance in their earnings reports where they once did does not bode well.

Good point. Doesn't look like retail will be doing much hiring since the malls are all out of business.

[bart]

The four week moving average has leveled off. I guess we could see a spike later in the year. But does 650,000 a month add up to 20%?

Although I'm less pessimistic about unemployment than EJ, it's not a high probability event to bet against him.

Here's a current picture of claims, adjusted for the size of the insured employment pool, that shows we're quite far from the peaks recorded in the '70s and '80s.


http://www.nowandfutures.com/images/claims_percent_workforce.png

[ratfink]

why don't americans move? (http://www.itulip.com/forums/showthread.php?p=93661#poststop)

Interesting. I thought it was so that they wouldn't feel their shackles!:D

[metalman]

Although I'm less pessimistic about unemployment than EJ, it's not a high probability event to bet against him.

Here's a current picture of claims, adjusted for the size of the insured employment pool, that shows we're quite far from the peaks recorded in the '70s and '80s.


http://www.nowandfutures.com/images/claims_percent_workforce.png

that means only one thing... time for the gov't to change the rules again!

[Finster]

Although I'm less pessimistic about unemployment than EJ, it's not a high probability event to bet against him.

Here's a current picture of claims, adjusted for the size of the insured employment pool, that shows we're quite far from the peaks recorded in the '70s and '80s.


http://www.nowandfutures.com/images/claims_percent_workforce.png

Each of those peaks represented a good time to buy stocks, no?

[stockman]

Each of those peaks represented a good time to buy stocks, no?

'PEAKS' being the critical word, right?

[bart]

Each of those peaks represented a good time to buy stocks, no?

Indeed Manor Maven... as long as they weren't ones like Enron or Bre-X... :eek: ;)

[Rajiv]

To me this is a very ominous chart coupled with the video 2000 people applied for 60 jobs at grocery store in Dublin yesterday (http://www.itulip.com/forums/showthread.php?t=9580)

This time there is no lag between initial claims and continued claims, and for any time point, continued claim numbers, and initial claim numbers are not separated as in previous large downturns. That means very few of the people on the unemployment rolls are finding employment!

[tombat1913]

Would you mind explaining to this ignorant bloke - what's a "replenishment pod"? The only Google hit I got was for a Cuisinart prepackaged coffee pod.
I may be an ignorant bloke too, but I think that was a joke, something that exists in video games.

[tombat1913]

Good Grief, did you have to give it that depressing picasso effect?
http://pablo-picasso.paintings.name/blue-period/images/1024/life.jpg
Couldn't you use ROYGBIV so we get a psychadelic journey through the rainbow and end up somewhere pleasant and purple?
http://farm2.static.flickr.com/1414/623953700_a95efa13e9_m.jpg
Far out man!~~~~~~~~~~~~~~

[tombat1913]

In the semiconductor industry, jobs are pretty much non existent right now. Never seen anything like this in this sector
analog2000
Analog,

I was talking with my step father over Christmas break, he works for a semiconductor company, says the CEO is of the mind that they are all of a sudden not a semiconductor company any more. Now they're a green energy company, working on some solar project named magic solar or something rediculous that's supposed to save their asses. He had to lay off some people recently and lost quite a bit of sleep over it. I bought them a copy of Bubble Economy for Christmas of '07 but it didn't get read, I don't know what good it would have done as far as the job but could've helped with the 401(k). It's a rough economy right now for sure.

[goadam1]

Advertising is in the crapper. It's a lagging business. We will be part of the 2010 bottom. I hope I can keep my business together.

[santafe2]

Advertising is in the crapper. It's a lagging business. We will be part of the 2010 bottom. I hope I can keep my business together.

Insurance business is also feeling the pain as people lose their jobs the pool of health insured is shrinking, more people are driving without insurance and fewer trades people and businesses are carrying liability, workers comp, etc. The insurance companies are beginning to raise rates to compensate.

Health providers will be hit by the next wave as more uninsured start showing up at hospitals.

The economy has been absolutely flatlined for 6 months at a functional level equivalent to the mid 90s. That is, 306M people trying to function in an economy capable of supporting many fewer. If I use 5% as baseline unemployment and economic activity remains at this depressed level, I calculate 26M unemployed or 17%.

[goadam1]

Insurance business is also feeling the pain as people lose their jobs the pool of health insured is shrinking, more people are driving without insurance and fewer trades people and businesses are carrying liability, workers comp, etc. The insurance companies are beginning to raise rates to compensate.

Health providers will be hit by the next wave as more uninsured start showing up at hospitals.

The economy has been absolutely flatlined for 6 months at a functional level equivalent to the mid 90s. That is, 306M people trying to function in an economy capable of supporting many fewer. If I use 5% as baseline unemployment and economic activity remains at this depressed level, I calculate 26M unemployed or 17%.

I see the math of getting to 145 or 15% but I am having trouble getting to 20%. Are there 6 months of over a million job losses in the prediction.

[santafe2]

I see the math of getting to 145 or 15% but I am having trouble getting to 20%. Are there 6 months of over a million job losses in the prediction.

I still think I'm doing something wrong with my number at 17%, (too high I think). At, 15% U3 we know U6 will be about twice this number. In unemployment terms, this will be worse than the Great Depression. I don't want to compare the two with regard to level of suffering but the numbers are staggering if correct and of course, EJs are even worse than that.

In U6 terms EJ is over 60MM unemployed or under employed. I don't see how that will happen. I'm not saying it won't, just that the number is so huge, it doesn't seem possible.

[Finster]

'PEAKS' being the critical word, right?

Yup. But you could also say about the same with respect to any point a couple percent or more above trend ...

[Finster]

Indeed Manor Maven... as long as they weren't ones like Enron or Bre-X... :eek: ;)

Ha! :D

For "stocks" I'd stick with something more like VT ...

[jk]

I still think I'm doing something wrong with my number at 17%, (too high I think). At, 15% U3 we know U6 will be about twice this number. In unemployment terms, this will be worse than the Great Depression. I don't want to compare the two with regard to level of suffering but the numbers are staggering if correct and of course, EJs are even worse than that.

In U6 terms EJ is over 60MM unemployed or under employed. I don't see how that will happen. I'm not saying it won't, just that the number is so huge, it doesn't seem possible.
i'm not sure we can assume that the relationship between u3 and u6 will be linear across so wide a range. for example, if masses of people lose work quickly then u3 will grow faster than u6 as workers will not have time to run out of unemployment benefits and become discouraged.

[idianov]

The employment situation is getting worse each day. The automatic tax deductions are really collapsing in April 2009.



Withholding Taxes Chart (http://www.trivisonno.com/withholding-taxes-chart)

Each business day, the United States Treasury Department publishes a report on the workings of the government’s income and spending. One of the items on this report is the “Withheld Income and Employment Taxes.” (Here in the USA, workers have taxes automatically deducted from each paycheck.)

Current through the Daily Treasury Statement dated April 23, 2009.

1479

1480

[santafe2]

i'm not sure we can assume that the relationship between u3 and u6 will be linear across so wide a range. for example, if masses of people lose work quickly then u3 will grow faster than u6 as workers will not have time to run out of unemployment benefits and become discouraged.

That's one possibility jk. But what I'm hearing around here is that many companies and government agencies are talking to their workforce about cutting back hours, furloughs, picking up a bigger percentage of heath care costs and/or cutting back the level of service.

I wish I had more solid details on how people flow through the unemployment process. It seems to me that the opposite could take place. That is, that U6 will rise faster than U3. In fact, if I was President and wanted to keep the U3 numbers lower I'd make sure that cutting back hours was the way people became less employed without ever being unemployed. That is, move directly from employed to U6 - willing to work more hours if they're available.

Pull out the kinder, gentler card while pursuing a completely different agenda and then communicating directly to the MSM about how well the stimulus package is working and how great America and Americans are because they're all pulling together and not letting any of their colleagues lose their employment. Spin it as the win-win solution, rah-rah and all that.

[santafe2]

The employment situation is getting worse each day. The automatic tax deductions are really collapsing in April 2009.

Maybe Bart can speak to the relationship of the chart you published showing a 9% decrease in tax collection last quarter and a 4.5% increase in unemployment. Is the rest of it coming from under employment and under-reported under-employment?

For example, I can't imagine that realtors, working on commission would show up as under employed but while their hours have probably gone up, their income has decrease dramatically.

Thanks for posting the chart.

[cjppjc]

Maybe Bart can speak to the relationship of the chart you published showing a 9% decrease in tax collection last quarter and a 4.5% increase in unemployment. Is the rest of it coming from under employment and under-reported under-employment?

For example, I can't imagine that realtors, working on commission would show up as under employed but while their hours have probably gone up, their income has decrease dramatically.

Thanks for posting the chart.


Yes. Income for real estate agents has gone down.

[whitetower]

Out of curiosity how do these labor/unemployment stats account for the large number of illegal immigrants in the US?

That is, some estimates indicate there are something on the order of 15 million illegals in the US -- now, not all are working, but one must suppose that significant numbers are.

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

[santafe2]

Out of curiosity how do these labor/unemployment stats account for the large number of illegal immigrants in the US?

That is, some estimates indicate there are something on the order of 15 million illegals in the US -- now, not all are working, but one must suppose that significant numbers are.

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

The key word is undocumented. It's no more official than alcohol during prohibition. They don't exist.

[stockman]

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

Reality MANY Americans would be (are being) affected by 1 million illegals losing their jobs. I doubt that they would show in any official stats however.

[MLM]

Would you mind explaining to this ignorant bloke - what's a "replenishment pod"? The only Google hit I got was for a Cuisinart prepackaged coffee pod.

It is a takeoff on video games. Replenishment pods are "bunkers" stocked with food and weapons. If we get to 20% unemployment, we'll be about one National Guard callup from a Mad Max scenario. In which case knowing where the food and weapons are stored could be quite helpful.

[GRG55]

Out of curiosity how do these labor/unemployment stats account for the large number of illegal immigrants in the US?

That is, some estimates indicate there are something on the order of 15 million illegals in the US -- now, not all are working, but one must suppose that significant numbers are.

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

If the "lifestyle and material condition of no American has been affected" then there wouldn't be any landscaping companies closing...

You can bet your azz that a million illegal workers losing their jobs is going to have some effect on Americans...even if it's just the local grocery store where they used to buy their food and the local gas station where they used to buy their fuel to get to and from those illegal jobs.

[flintlock]

Out of curiosity how do these labor/unemployment stats account for the large number of illegal immigrants in the US?

That is, some estimates indicate there are something on the order of 15 million illegals in the US -- now, not all are working, but one must suppose that significant numbers are.

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

I'd venture to guess the illegal immigrant community has been harder hit by unemployment than the rest of the country. Jobs were highly concentrated in construction. I don't think they are counted in the official stats.

I did hear something on the radio for the first time the other day. A "home builders" organization coming out against hiring illegal aliens, saying jobs should go to Americans first. Talk about a bunch of hypocrites! Where were these guys during the housing boom?

[cjppjc]

I did hear something on the radio for the first time the other day. A "home builders" organization coming out against hiring illegal aliens, saying jobs should go to Americans first. Talk about a bunch of hypocrites! Where were these guys during the housing boom?


Busy making money.

[bart]

I see the math of getting to 145 or 15% but I am having trouble getting to 20%. Are there 6 months of over a million job losses in the prediction.

I still think I'm doing something wrong with my number at 17%, (too high I think). At, 15% U3 we know U6 will be about twice this number. In unemployment terms, this will be worse than the Great Depression. I don't want to compare the two with regard to level of suffering but the numbers are staggering if correct and of course, EJs are even worse than that.

In U6 terms EJ is over 60MM unemployed or under employed. I don't see how that will happen. I'm not saying it won't, just that the number is so huge, it doesn't seem possible.


Per the BLS, currently the total civilian labor force is around 154 million, employed is around 141 million and "covered" employment (for determination of unemployment benefits) is around 134 million... and the total US population is around 306 million. I frankly don't know with decent certainty which one of those first three the BLS uses, and I've looked.


I've heard & seen numbers of around 5 million jobs lost since the low in 2007 for U-3 which would put total U3 unemployment around 12 million. We started at about 7 million U3 unemployed in Oct 2007.
The math doesn't work or I haven't been able to figure out what the BLS is doing. But assuming those numbers anyhow, a 20% U3 would indeed require about another 6 million job losses.

Also keep in mind that the peak isn't likely until mid 2010 at the earliest, which would mean we would "only" need less than 500k per month U3 job losses which is less than the current rate of loss. And the withholding chart posted shows that we'll likely jump to at least 9.2% U3 this month, which would be at least 600k.


I also don't think its valid to think that U6 would be double U3 since the rough U6 history I've been able to put together shows that it has never been double at the U3 peak, partially because U3 tends to peak before U6.

The 2001-2 recession in fact showed a U6 peak "only" about 60% higher than U3. So, instead of 40% U6, it would be closer to 30-32% and a total U6 incremental job loss since Oct 2007 of about 16-17 million jobs... and a grand total peak U6 unemployed (adding in the 12 million base from Oct 2007) of 28-29 million.

Here's a long term unemployment chart with my various extrapolations and interpolations:

http://www.nowandfutures.com/images/unemployment.png


And all this is contingent on so many wild variables like BLS definitions or redefinitions that I've stocked up on Excedrin.

Hope this helped a little...

[bart]

Ha! :D

For "stocks" I'd stick with something more like VT ...

Looks like a good choice... and I'd also take CEF for at least $2000, Alex... ;)

[Rajiv]

There was this article in Dec 2008 - Illegal immigrants Going Home, Endangering U.S. Labor Markets (http://www.catholic.org/international/international_story.php?id=31100)

The Center for Immigration Studies was the first to note that undocumented immigrants were leaving the United States.

Malaquias Gaspar left his farm village in southern Mexico when the economy soured in the mid-1990s. He headed north illegally and found the proverbial better opportunity in South Florida, where he made a decent living by picking fruit and building homes.

But the U.S. economic crisis has disrupted his life and the lives of countless other illegal immigrants who are now planning to leave or have already left.

Gaspar recently returned to Zimatlan de Alvarez in Oaxaca state, primarily to care for his ailing mother _ but also to plan for the future should the economy worsen in South Miami-Dade County, where his wife and four children remain.

"If we can't feed our children, we'll come back," said Gaspar, 40, as he sat at his family home _ upgraded with money he had sent from South Florida.

Gaspar is among millions of undocumented immigrants facing new challenges brought on by slim prospects for legalization, more aggressive federal enforcement and a worsening economy. Now, fewer immigrants are caught while trekking through the dangerous Sonoran Desert or risking their lives aboard makeshift boats in the Caribbean, indicating that fewer are trying. Those who make it through can find themselves on one of several daily federal charter flights that return deportees.

The ripple effects are already being felt. Communities in Latin America and the Caribbean report a reduction in remittances _ money sent home from the United States.
.
.
.
.
.
.

[goadam1]

Out of curiosity how do these labor/unemployment stats account for the large number of illegal immigrants in the US?

That is, some estimates indicate there are something on the order of 15 million illegals in the US -- now, not all are working, but one must suppose that significant numbers are.

Say a landscaping company closes down and 20 illegals lose their jobs. Say a bunch of landscaping companies close and 1 million illegals lose their jobs. Does this show up in the government unemployment data -- and if so, why, despite the fact that the lifestyle and material condition of no American has been affected?

Let's see a housing crash in the US sends millions of people back into Mexico. They are as poor as ever. They bring back some virus that is novel to rural farming areas. The virus mutates and returns as a virulent and deadly bug. This stuff is all connected.

[magicvent]

Potential unemployment numbers in Ohio:

http://www.economicpopulist.org/?q=content/gm-layoffs-will-boost-unemployment-through-roof

[jk]

Per the BLS, currently the total civilian labor force is around 154 million, employed is around 141 million and "covered" employment (for determination of unemployment benefits) is around 134 million... and the total US population is around 306 million. I frankly don't know with decent certainty which one of those first three the BLS uses, and I've looked.


I've heard & seen numbers of around 5 million jobs lost since the low in 2007 for U-3 which would put total U3 unemployment around 12 million. We started at about 7 million U3 unemployed in Oct 2007.
The math doesn't work or I haven't been able to figure out what the BLS is doing. But assuming those numbers anyhow, a 20% U3 would indeed require about another 6 million job losses.

Also keep in mind that the peak isn't likely until mid 2010 at the earliest, which would mean we would "only" need less than 500k per month U3 job losses which is less than the current rate of loss. And the withholding chart posted shows that we'll likely jump to at least 9.2% U3 this month, which would be at least 600k.


I also don't think its valid to think that U6 would be double U3 since the rough U6 history I've been able to put together shows that it has never been double at the U3 peak, partially because U3 tends to peak before U6.

The 2001-2 recession in fact showed a U6 peak "only" about 60% higher than U3. So, instead of 40% U6, it would be closer to 30-32% and a total U6 incremental job loss since Oct 2007 of about 16-17 million jobs... and a grand total peak U6 unemployed (adding in the 12 million base from Oct 2007) of 28-29 million.

Here's a long term unemployment chart with my various extrapolations and interpolations:

http://www.nowandfutures.com/images/unemployment.png


And all this is contingent on so many wild variables like BLS definitions or redefinitions that I've stocked up on Excedrin.

Hope this helped a little...
that helped a lot. very useful exposition. thanks.

[santafe2]

Here's a long term unemployment chart with my various extrapolations and interpolations:

http://www.nowandfutures.com/images/unemployment.png


Hope this helped a little...

Thanks Bart. It did help me understand that my more linear explanations need more work if I'm going to get closer to an explanation that makes sense.

[billstew]

I loved the animation, but could someone produce a 1990s unemployment animation that is 50%-60% slower?

The speed is too fast to adequately perceive the non-uniformity of the recessions.

The iTulip animation is OK, but it trends to a visually fixed darkness and colour intensity.

A 2nd version of it about 5% to 10% slower would be nice.

[billstew]

We are sticking to our forecast of 20% U3 unemployment in the U.S. by the end of 2010.

CORRECTION

Don't you mean 25% of U6 unemployment by the end of 2010?

U3 and U6 are themselves shoddy and untrustworthy -- SO WHAT DO YOU MEAN IN TERMS OF Shadow Stats "Total Cumulative Unemployment"?

[billstew]

Americans don't move because

1. They have no concept of non-US places existing

2. Moving inside the US only levels out the unemployment rate so much

3. Americans lost the concept of immigrating after WWII

4. The French don't typically move out of the Hexagon either

5. Much like the USSR, the US is a beyond totally corrupt regime that does not really permit people to move

[highcastle]

I don't think it will be possible to make it up to 20% U3. It only takes a year for workers to become 'discouraged' in the calculation of unemployment. This means if we end up having an L shaped depression, actual unemployment could be sky high with U3 still in the low teens.

One thing is for sure, more and more people will begin to disbelieve the government numbers of unemployment. If we want to measure the economy going forward, I think the only truthful method left is to monitor tax receipts. All the other government statistics and surveys are subject to manipulation and political pressure to fudge them.

[FRED]

I don't think it will be possible to make it up to 20% U3. It only takes a year for workers to become 'discouraged' in the calculation of unemployment. This means if we end up having an L shaped depression, actual unemployment could be sky high with U3 still in the low teens.

One thing is for sure, more and more people will begin to disbelieve the government numbers of unemployment. If we want to measure the economy going forward, I think the only truthful method left is to monitor tax receipts. All the other government statistics and surveys are subject to manipulation and political pressure to fudge them.

We agree with this assessment. The number that the government watches most carefully is the number unemployed for 26 weeks or longer. After that, Federal unemployment runs out and state funds are tapped. After one year, all unemployment funds are tapped and the unemployed are without income. On average, unemployment insurances pays 38% of previous income.

Here's the update to our monthly U.S. unemployment graph for April 2009 from the BLS. The rate of increase in unemployment remains in the range of 1.1 to 40% for every state except North Dakota where unemployment is rising at an annual rate of 0.6% to 1%.

http://www.itulip.com/images/unempstateApr2009.gif

[ax]

One thing is for sure, more and more people will begin to disbelieve the government numbers of unemployment. If we want to measure the economy going forward, I think the only truthful method left is to monitor tax receipts. All the other government statistics and surveys are subject to manipulation and political pressure to fudge them.[/quote]

I agree highcastle, here are recent stats for AZ:

April tax collections the worst since 1996.

Personal income tax: Down 26% in first 10 months of this fiscal year compared to first ten months of previous fiscal year

Sales tax: Down 13%

Corporate income tax: Down 26.5%

Expected deficit now $3 billion in coming fiscal year (beginning July 1)

Don't think anyone there believes things are getting better.

[ThePythonicCow]

If we want to measure the economy going forward, I think the only truthful method left is to monitor tax receipts. All the other government statistics and surveys are subject to manipulation and political pressure to fudge them.
Shhh!! Quiet!! Don't give the feds any ideas.

[Rajiv]

Interesting about North Dakota. Could Ellen Brown just be right?

CASH-STARVED STATES NEED TO PLAY THE BANKING GAME:
NORTH DAKOTA SHOWS HOW (http://www.webofdebt.com/articles/state_bank_option.php)

TURNING THE TABLES ON WALL STREET:
NORTH DAKOTA SHOWS CASH-STARVED STATES HOW THEY CAN CREATE THEIR OWN CREDIT (http://www.webofdebt.com/articles/state_bank_option2.php)

BUT GOVERNOR, YOU CAN CREATE MONEY! JUST FORM YOUR OWN BANK. (http://www.webofdebt.com/articles/but_governor.php)

[FRED]

Interesting about North Dakota. Could Ellen Brown just be right?

CASH-STARVED STATES NEED TO PLAY THE BANKING GAME:
NORTH DAKOTA SHOWS HOW (http://www.webofdebt.com/articles/state_bank_option.php)

TURNING THE TABLES ON WALL STREET:
NORTH DAKOTA SHOWS CASH-STARVED STATES HOW THEY CAN CREATE THEIR OWN CREDIT (http://www.webofdebt.com/articles/state_bank_option2.php)

BUT GOVERNOR, YOU CAN CREATE MONEY! JUST FORM YOUR OWN BANK. (http://www.webofdebt.com/articles/but_governor.php)

Ellen does not understand the FIRE Economy. She says:

Today we are in a dangerous deflationary spiral, as lending has dried up and asset values have plummeted.

Without an understanding of the FIRE Economy, asset price inflation and deflation in the FIRE Economy is confused with commodity price inflation and deflation in the Production Economy.

Deflation spiral in asset prices such as houses, yes. But deflation spiral in oil? Gold? Stocks?

Not quite.

[Rajiv]

Ellen does not understand the FIRE Economy.
.
.
.
Without an understanding of the FIRE Economy, asset price inflation and deflation in the FIRE Economy is confused with commodity price inflation and deflation in the Production Economy.

Deflation spiral in asset prices such as houses, yes. But deflation spiral in oil? Gold? Stocks?

Not quite.

In a personal communication, Ellen responded:

My point is that there is much less money available now than there used to be. This is because the "shadow lenders" went away and aren't coming back. They financed 40% of the housing market. So even if banks were fully loaned up, the market would still have only 60% of the funding it used to have.

[bart]

Some perspective - credit is approaching zero growth, but credit plus gov't debt is still expanding at over 4%.


http://www.nowandfutures.com/images/credit_all.png



http://www.nowandfutures.com/images/credit_debt.png

[phirang]

Steel utilization is a great metric...

[metalman]

Steel utilization is a great metric...

electricity consumption, also.