By now you've probably heard or seen the October employment numbers from the BLS. Net jobs were 80,000 and the narrowest unemployment level was notionally down from 9.1% to 9%. CNBC's various reporters and anchors all tried to talk up these continuing weak economic numbers, claiming that, once you got past the anemic new jobs created, all is bright with the US economy.
The phrase that came to my mind was 'angels dancing on the head of a pin.'
I mean, really, look at the trends. How long has unemployment, narrowly measured, been at or above 9%? A year? It's at least twice what Americans are used to seeing.
The widely-defined unemployment measure, U6, is still up in the teens and largely unchanged.
And the monthly jobs number- only +80,000.
You can search various prior posts I've written discussing what the monthly new jobs number must be just to absorb the new entrants into the US labor pool. I feel like I'm writing about France now. That's how sluggish the economy has become on the employment front.
Meanwhile, I read a piece in this morning's Wall Street Journal discussing China's slow but steady rise in innovation ranking, while the US fell from 4th to 5th in the most recent table. Several pundits cited US firms continuing to base more plants and research facilities in China, hiring Chinese PhDs who file patents. And noting that, over time, innovation occurs at and with manufacturing sites, thus slowly hollowing out more of the US manufacturing base from an innovation perspective.
Fresh in my mind as I write this is the anecdote involving recently-deceased Steve Jobs assailing Obama for not opening the US labor market to more foreign-born PhDs. That Apple had to locate plants overseas, in Asia, because it couldn't recruit sufficient numbers of US engineers, so both the engineering and production jobs, numbering in the tens of thousands, went to Southeast Asia. The president's reply was a muddled, political obfuscation involving the complexity of immigration policy.
Much like it ignores the true depth and breadth, and causes, of the current European debt crisis, US equity investors are seemingly sticking their heads in the sand regarding US economic growth and unemployment. As I write this, the Bloomberg anchor is citing 7 years as the time required, at 80,000 net jobs created per month, to re-employ US workers back to, I believe, the 2007 level.
As I wrote here yesterday, there's simply no way these monthly numbers should give anyone confidence that the US economy is healthy and undergoing a normal expansion.
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