Joe Uncovers Gov Conspiracy over Unemployment Report

According to the Bureau of Labor Statistics, July’s unemployment rate dropped to 9.4% from 9.5% in June. Meanwhile, the economy shed 247,000 jobs during the month. Say what? You mean we can actually lose jobs and decrease the unemployment rate at the same time? This is great news. You mean during the first part of the year, when we were losing half a million jobs per month, we could have actually been lowering the unemployment rate at the same time? Why didn’t we do this earlier? (Joe, late to the party, but at least Joe’s at the party now….right)

According to the report, the labor force actually decreased during the month as frustrated job seekers stopped looking; and to be included in the job force, you have to be actively searching for a job. (Joe, searching frantically for the party, but not finding) This is the reason the unemployment rate dropped.

It gets stranger, however. In June, the US economy shed 443,000 jobs, and the unemployment rate increased a paltry one basis point from 9.4 to 9.5%. In July the US economy slashed 247,000 jobs and the unemployment rate simply dropped back down to 9.4%. So, in the period of two months, the US economy has lost almost 700,000 jobs and the unemployment rate remains unchanged at 9.4%. That’s almost a million jobs (Joe march in Atlanta) and we are still at 9.4%. Why didn’t I think of this first? (Joe Patent pending)

Just to give you some historical perspective, in January of ’09 the US economy lost 598,000 jobs and the unemployment rate increased from 7.2 in December to 7.6%. In February, the US economy slashed 651,000 jobs, and the unemployment rate increased from 7.6 to 8.1%. This was a fairly common pattern through the first half of 2009 - lose half a million jobs, unemployment rate climbs 4 to 5 basis points.

So what’s going on? Is the economy improving or is this simply a conspiracy to make the numbers look better? (Joe contemplating gov offered kool-ade) What does Wall Street think of the unemployment report? Initially this was great news, as the market leaped almost two hundred points by midday on Friday. However, since that point, the market lost 89 points by the end of the day. On Monday, August 10th - Dow down 34 points. Tuesday the 11th - down 94 points. Where’s the party now? Is the punch bowl, or rather kool-ade bowl empty? The music is still playing but there’s no more dancing? “But the unemployment rate dropped you guys”, says Joe with a glass full and dancing by himself.

JoAnn warned Joe of this however. As Joe walked in the front door JoAnn was leaving and told him the kool-ade needed more sugar, because it had turned sour and slightly bitter. Joe had been sprinting to get to the party in time, however, and his thirst too join the party was overpowering so he brushed off her advice and ignored the warning signs. We’ll see what the future holds. Until then, hold off on the kool-ade, will ya Joe? Drink at your own risk.