Fallout from the Crash: Unemployment

Lost in the noise last week was the unemployment report. Weekend pundits gushed how we turned the corner. Have we?

Art Cashin dissects it this morning:

  • For the last eight weeks, Initial Unemployment Claims have averaged 450,000 per week. So, over the last four weeks [the month counted], 1.8 million people were laid off. How does that fit in with the claim that 290,000 new jobs were created? The obvious answer is that it doesn’t
  • The CES Birth/Death adjustment added 188,000 of those jobs. Birth/Death does not refer to people but to businesses. The BLS guesses how many new companies opened versus how many closed their doors. The BLS then uses that guess to guess again how many jobs those business created or lost
  • Another 66,000 of the new jobs came from census hiring
  • Another 26,000 of the new jobs were non-census temporary

Let’s recap:

  • A guess produced 188,000 of the jobs, 66,000 were census and 26,000 were temporary.
  • 280,000 of the 290,000 “new jobs” were either temporary or the result of guesswork.

Some turn. Some corner.

About Duncan Davidson 228 Articles

Affiliation: NetService Ventures

Duncan is an advisor to NetService Ventures, where he focuses on digital media and the mobile Internet.

Previously he was at four start-ups: Xumii, a mobile social service based on a Social Addressbook; SkyPilot Networks, the performance leader of wireless mesh systems for last-mile access, where he was the founding CEO; Covad Communications (Amex: DVW, $9B market cap at the peak), the leading independent DSL access provider, where he was the founding Chairman; InterTrust Technologies ($9B market cap at the peak), the pioneer in digital rights management technologies, now owned by Sony and Philips, where he was SVP Business Development and the pitchman for the IPO.

Before these ventures, Duncan was a partner at Cambridge Venture Partners, an early-stage venture firm, and managing partner of Gemini McKenna, a joint venture between Regis McKenna's marketing firm and Gemini Consulting, the global management consulting arm of Cap Gemini.

He serves on the board or is an adviser to Aggregate Knowledge (content discovery), Livescribe (digital pen), AllVoices (citizen journalism), Xumii (mobile social addressbook), Verismo (Internet settop box), and Widevine (DRM for IPTV).

Visit: Duncan Davidson's Blogs

1 Comment on Fallout from the Crash: Unemployment

  1. Exactly right. But Congress and the Media have been trying to get people to believe all is ok.

    We need to extend Tier 5.

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