Experts predicted almost 400,000 new jobs in December. I can see that, especially with the holidays later in the month.
(I hope you guys like my jobs reports blogs. I love dissecting financial information!)
But the economy only added 199,000 new jobs and the labor participation rate remained unchanged despite the Christmas season.
Those who want a job and are not in the labor force hardly changed at 5.7 million in December. But there’s more to it:
In December, 3.1 million persons reported that they had been unable to work because their employer closed or lost business due to the pandemic—that is, they did not work at all or worked fewer hours at some point in the 4 weeks preceding the survey due to the pandemic. This measure was down from the level of 3.6 million in November. Among those who reported in December that they were unable to work because of pandemic-related closures or lost business, 15.9 percent received at least some pay from their employer for the hours not worked, little changed from the prior month.Among those not in the labor force in December, 1.1 million persons were prevented from looking for work due to the pandemic, little changed from November. (To be counted as unemployed, by definition, individuals must be either actively looking for work or on temporary layoff.)
All of this happened before this Omicron Covid surge!
Yikes.
The media has latched on to the unemployment rate, which is down to 3.9% from 4.2%. But you need to look at the entire picture.
The people concentrate on the U-3, which is the total unemployed. The U-6 includes everyone.
The U-6 fell as well from 7.7% to 7.3%.
But you cannot smile about the unemployment rate because the economy barely added any jobs. Let’s not forget that 4.5 million people quit their jobs in November.
The country saw an average of 199,000 unemployment claims a week in December 2021.
The unemployment claims assessment on Thursday showed 207,000 people filed new unemployment claims, which is an increase of 7,000 from the previous week.
Overall it is hard to dissect the jobs reports since 2020. I harped on Trump’s administration and I will do the same to Biden because how many of these are actually new jobs and not just old positions reopening? How many of these jobs are because of actual growth and expansion at the companies?
We also do not know the motivations behind people quitting their jobs. Could it be for better and higher-paying jobs? The jobs report had a few positives like hourly earnings increased by 19 cents to $31.13. Those earnings have risen by 4.7% in the past 12 months.
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