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Reaction to shocking jobless data

December 5, 2008


November’s job losses were the steepest since December 1974, when 602,000 jobs were shed. Analysts polled by Reuters had predicted a reduction of 340,000 jobs.

“This is a clear employment blowout. Firms are reacting as dramatically as they can to make sure they have cost structures they can survive the recession we are in,” said Joel Naroff, president of Naroff Economic Advisors.

One reader commenting on the site feels the job losses have not hit bottom. “I predict 30% unemployment by March of 2009. The retailers are gonna tank right after Christmas. Look for some really good deals!” wrote Smacktle.

Not all responses were as dire.

“Well these are pretty bad numbers. This will be a real test to see how much bad news is priced into the markets. Futures are down quite a bit, but I actually expected them to be down a lot more given these terrible recessionary numbers,” says Jeff Kleintop, chief market strategist for LPL Financial in Boston.

“It might be hard in future months to get numbers that are any worse. It might be good that we raced to some of the worst numbers we’ve had because perhaps it can’t get incrementally worse.”

Some of our readers found the data less shocking.

“This is not a big surprise, really. One has only to observe how many fewer cars are on the road shortly after rush hour, how many empty seats are on the planes into or out of major hubs, how many fewer people are in front of you in any line for services from movie theaters to tire stores, how much more quickly you are seated in a restaurant,” writes Jaime Simmons.

What you think about today’s unemployment numbers?

(Pictured above: A member of the Laborers Union Local 89 waits outside his local union hall after placing his name on the job list in San Marcos, California November 7, 2008. REUTERS/Mike Blake)

Comments

Make that 199,001 jobs lost, I just axed 10 minutes ago

Posted by Unemployed199,001 | Report as abusive
 

Just keep in mind that many of us are self-employed or otherwise work in small businesses that don’t report layoffs. There are, I’m sure many thousands of Americans like me who don’t show up in the government figures. I’m sad to hear about 1/2 million people losing their jobs, but on the other hand I think, “Welcome to the club.”

Posted by Ron Frazer | Report as abusive
 

Numbers sound high relative to numbers announced daily. This 20,000 per day. Have not seen these kinds of numbers

Posted by Calvin | Report as abusive
 

What do you expect when our administration is filled with incompetant people and greed hit its zenith with the wall street firms. It think the FBI needs to start prosecuting CEOs of these firms.

May you live in interesting times….

Posted by Dave | Report as abusive
 

Unemployment will go to 9%

And low interest rates will not change anything.

Frank

Posted by Frank | Report as abusive
 

In my opinion the situation is going to be worse in next one year.Stats are just numbers,but we are dealing with lives and livelihood.As we have seen no amount of bailout or financial aid have benefited the industry.May be this is the right time to think about the path that we are following where we count each life as a digit in database.Main thing that people have lost confidence in the system.We are paying more emphasis in creating billionairs rather than valueing each life and environment.More important are small scale industry and enterpreunership than creating financial giants who get too lazy and stop serving the system.Executives in these giants earn/spend just too much.The corporate greed has given place to lies.To hide a lie,the corporates have invented 10 lies and hence the crisis.

 

If you want to bring back 1.2 million high tech jobs, Get rid of 1.2 million H1-B workers that were brought to this country. It is bad enough that Jobs are being sent overseas, it is worse when this country brings workers from overseas causing Americans to lose 1.2 million jobs. The H1-B program needs to be stopped and these jobs be given back to Americans.

Posted by Rich Rataj | Report as abusive
 

I am thankful that both my husband and I still have jobs. But we are more thankful that we started living below our means (budgeting) in February and paid off all our debts in August before this crisis really began. This has allowed us to sleep easier at night and not fear the next day’s bills or pink slips.

Posted by lee | Report as abusive
 

The markets reflect the future. I believe that the markets and jobs are moving downward because they are anticipating the new Marxist, socialist governmet that will be taking office on Jan. 20.

This new government will do even more harm to our country than most can even anticipate. I believe that this new goverment will not only destroy our economy even more but they will use the constitution as toilet paper. Not only will our financial future be at great risk but also our constitutional rights. This, I believe, is the major cause for our markets’ destruction.

Posted by Steve | Report as abusive
 

I think it will get considerably worse. The current administration is trying to push the string of credit as an almost exclusive way of dealing with an economy that doesn’t want more credit. This simply isn’t working. Consumers don’t want more credit but instead want to have less debt. Most of the consumer goods sold on credit are not necessities. As such, this could get a lot worse as regular folks hunker down and take their lumps.

I don’t see this turning around until quite a bit more debt is retired or destroyed. That will take years if the current methods are continued. Too bad the folks handing out the billions don’t understand that easy credit isn’t the answer this time around. Giving bailouts to banks and credit card companies doesn’t keep a roof over people’s heads or feed people who are hungry, it only perpetuates the status quo, which is currently downhill. It is amazing how too many houses are making more people homeless.

This issue goes way back to the response to 9/11 – when the response to “what can you do for your country now?” was “Go to the mall and shop”. Perhaps a more compassionate and conservative approach this time is feed and house your neighbor.

Fool me once, shame on you, fool me twice, shame on me.

Posted by JoeB | Report as abusive
 

I think a lot of this is to do with corporate budget cycles. They know 2009 will be bad, and they want to shed staff and pay severance this year (because the markets are low and aren’t expecting much). Then they can go into 2009 lean and ready for more (bad) stuff and not overweight.

So although this is terrible, and December could be worse, I suspect the early parts of next year will be much better.

When it comes to corporate cash-flow, and that’s important when there’s such a credit shortage, you don’t want to run out of money, unable to pay wages. So you plan for the worse, and shed one of the least flexible costs (employment) so you don’t hit the wall by running out of cash.

Posted by Nic Fulton | Report as abusive
 

My dad dropped out of the workforce in the mid 70s. He was a laborer and never found another job. I lost my job a few months ago. I anticipate the worst. Hang onto your hat folks!

Posted by RobW | Report as abusive
 

Can’t someone express this as a percentage of available workers? Today’s number is obviously distressing but it would feel so much more relevant if it could be compared to numbers from other years if all we expressed as a ratio. Also, it shouldnt be forgotten that the jobless number from 1945 represent a downshift in war related manufacturing.

Posted by Chris | Report as abusive
 

In 2005 both parties in Congress joined with the administration to change the Bankruptcy Code to make it difficult for consumers to discharge credit card debt. This statute, largely written by MBNA lobbyists, was enacted into law over the protests of lawyers and judges across the nation. The statute also made it much more difficult for people to reorganize their mortgage debt so that they could keep their homes.

There is no doubt that closing off of the “fresh start” and making the US Trustee’s office an attack dog had contributed to the current financial crash.

Our present members of Congress have done nothing about this. Let them know what you think of them, with their taxpayer-funded salaries, social life and parties, while thousands lose their jobs and homes and cannot use the bankruptcy law to get a fresh start and keep their homes.

 

That’s right about on track. What is currently happening is the Fed is trying to boost the economy by putting the country deeper into debt.
Evidently they didn’t realize that the reason the mortgage crisis occurred is due to a combination of people overextending themselves with too much debt, and also loss of jobs.

Posted by Chris | Report as abusive
 

I predict 30% unemployment by March of 2009. The retailers are gonna tank right after Christmas. Look for some really good deals!

 

‘….U.S. employers axed 533,000 jobs in November, the most since 1974, the Labor Department said on Friday. The unemployment rate rose to 6.7 percent from 6.5 percent in October…’

If I am correct, it means an increase of 533 000 lost jobs correlates to an increase of .2% in the unemployment rate. This means 1% of the US job market is equal to 2 665 000 people. So the TOTAL US job market employees 266.5 million people (in a country of just over 300 million total residents). That leaves very few kids and retirees. What gives? The unemployment ratio seems way too low…

Posted by blackbean | Report as abusive
 

The numbers are bad, but the unemployment rate still is not nearly as bad as it was in 1981. When I graduated from college in 1981 there was only one job available for my field, and 25,000 people applying for it. Even minimum wage jobs were difficult to get.

With commodity prices dropping, it will help the economy recover much quicker then most people think. In the 1970′s we had recessions because the middle class wages didn’t keep up with inflation. People would just stop buying like they did before. History repeats itself.

Posted by Dave | Report as abusive
 

Naroff said “perhaps it can’t get any worse”. Apparently he hasn’t been following congress lately, the majority of whom would be perfectly willing to let the Japanese have our entire auto industry, and much of the many jobs in it, and in related industries. If that happens, it will get much worse. Good thing we pumped hundreds of billions into banks (which we have too many of).. NOT.

Posted by Mark T | Report as abusive
 

This is not a big surprise, really. One has only to observe how many fewer cars are on the road shortly after rush hour, how many empty seats are on the planes into or out of major hubs, how many fewer people are in front of you in any line for services from movie theaters to tire stores, how much more quickly you are seated in a restaurant. I am always bemused at how the pundits are so shocked. Sometimes we over think things. The signs of slowdown in most sectors is all around you.

Posted by Jaime Simmons | Report as abusive
 

This should not be shocking, and this is only the beginning.

Posted by Rick | Report as abusive
 

I am beginning to really wonder what is actually going on. What scares me are not so much the stories that as a nation we are financially in a bad situation, what scares me more is the sense I get and in part from personal experience that our mechanisms for oversight have broken down and that journalists, lawyers, scholars, and others are not really picking up on this. If they are, no one is talking. Here is what I mean. I was laid off last December from a major university, business restructuring/economic downturn was the reason given. I understand that massive layoffs in the same university continued this year. Yet, some within those departments were given promotions this year, how is this possible if you say you are in financial trouble. Is what is really going on a massive cleansing by companies and organizations that are jumping on the economic bandwagon excuse to get rid of people. A cleansing not of individuals who were non-productive, but individuals who were creative, had voices, and in many instances only needed a few more years for retirement, hence pensions. The layoffs and how they are conducted have served to “chill” the other employees still left who are in fear of saying or doing anything that might target them as layoff material. Also, laying people off en masse due to an economic downturn makes potential lawsuits for things such as retaliation practically impossible. So what is happening is very dangerous and if employers are not checked more carefully they may wreck the economy in a manner that no stimulus package can correct. Another area where common sense has to question oversight has to do with accountability. For example, we now learn that the MTA in NY will be running at a huge deficit by next year. Where has all the money gone from all those fares they increased over the past couple of years, especially when we received reports that ridership was up? Add to that the fact that many of the subway stations do not have have clerks anymore, i.e., less employees? Where did the saved money from those layoffs go? How on earth can there be talk now of increasing fares when people are out of work? I don’t get it, I feel like something deeper than the economy is collapsing and instead what is on the rise is greed and injustice all disguised under “economic downturn.” I mean, does any of this make sense to anyone out there. Yes, we all have to tighten our budgets, even employers, but the manner and rate of lay offs has really caused me to question things and I hope others are beginning to question things as well.

Posted by H. Ortiz | Report as abusive
 

Panic, fear, and depression seems to be all I see in this information on unemployment. I would like to see some comparative facts; how many folks were employed in 1974, how many are employed in 2008? What percent of the total workforce was out-of-work in 1974, what percent of the total workforce is out-of-work in 2008.
Does the Media take delight in promoting Headlines for the sake of Headlines rather than intelligent journalism? Is there some cruel pleasure in sensationalism? Whatever happen to research of facts and background? You can do better than this!

Posted by Jerry | Report as abusive
 

I predict nearly 50% – 70% unemployment within a year from now.

Starting with the premise that the domestic terrorists on wall street leveraged about a trillion dollars at about 50-70:1. That makes about 50 to 70 trillion dollars of fake created wealth. I laugh when I hear talk about the bailouts. A few hundred billion or a few thousand billion is just a drop in the bucket.

A majority of the magically created wealth was immediately pumped back into the economy in the form of consumption and consumer spending. A earth killing consumption that we call living the American dream. Bottom line: We have been living like we have 50 to 70 times more money than we actually have.

Based on the above one could say that we as Americans are in for a rude awaking. The huge growth in the economy over the last 7 years was fake. The lifestyle we were living was available due to cheap credit and it seems logical that things need to adjust by 50% – 70%. i.e. – Unemployment Rate.

Posted by NoGoodNews | Report as abusive
 

woa is me,woa is me. What did the people in the U.S.A. think when our goverment made more money and more money that isn’t their in the first place,letting the oil companys rip us off,throwing our country in to a reccesion which later on will change to,well you should be able to guess.More and more people are lossing their jobs because no one has any money to spend or they don’t know whats going to happen tomarrow.Get ready for it will get worse than it is now .

 

Nothing special in this unemployment – same thing happened in 1992 and to same extent. Media wants to build up terror to sell newspapers but this can worsen recession by keeping people from spending.

Now we don’t hear too much about oil companies ripping us off with gas well under $2. Maybe the oil companies need to be bailed out next.

The world is not coming to an end.

Posted by Nrm | Report as abusive
 

This leaves a lot of people to pray for through this season. It is amazing to me how Sec. Of Treasure thinks. He and our Presidents are nothing but puppets, they have no more to do with running this country than the man on the moon, but you can’t tell people that. Our media is already setting Americans up more money for bailouts, not one word to help the people who paid the money in taxes. Not one word about saving a home, not one word to help the homeless. They did decide to help the people who were NO RISK at all. Don’t get behind on a bill, these these companies that you owe the money to will triple that bill, and make sure you will never catch up on it. Why? Because in this country, if a company can show a big enough loss, then our country will BAIL THEM OUT..Free money.
Just a sign of the Days.
WSOP&NE

 

Nixon took us off the gold standard; Johnson debased our specie. Fractional banking through the Federal Reserve has caused every bill in circulation to be, not money, but a commercial lien instrument issued in favor of the owners of the Federal Reserve. Yes, we are now in a banker’s harvest that lays the groundwork for an international medium of exchange, and this is an intermediate step toward the cashless society.

Posted by Larry | Report as abusive
 

Where’s all the money? If you issued a mortgage and sold it as a mortgage backed security you got your money back.

These companies bought bonds backed by student loans and credit card balances, where did the money they paid for these securities go?

The media has reported the loss of some investment firms that purchased risky assets as a complete economic crisis and therefore reduced consumer confidence resulting in a slow down of spending and corporate panic that resulted in outrageous layoffs. My company made more money in Novemer this year than November of 2004 yet we have cut more jobs than ever. This is a media generated hysteria that companies are using as an excuse to increase profits through layoffs. No longer do we strive for inovative methoids to increase revenue when it is easier to take it out of the pockets of our employees.

Congress and senate has allowed a few investment firms to convince them that all the money is gone. If they wanted to free up credit for indviduals 700 billion in loans would have done that, FHA to issue mortgages, small business administration for business loans, and hybrid car loans, but instead it went to the gamblers to reduce their losses like they would loan out all that money rather than cover their losses with it. This is a hiest!!!

No longer do you own stock in a company to collect dividends when they make money. Now it is a gambling hall where to buy and sell, where rumor dictates stock prices.

Posted by Larry | Report as abusive
 

On Friday the american econonmy lost 533000 jobs, but the same day wall street rallied 258 points. This means that loosing jobs is positive for stocks. Next time if nfp es minus 1000000, stocks will rally more than 500 points.

Posted by DOOMSDAY CLOCK | Report as abusive
 

The true depth of suffering can not really be known as unemployment figures only reflect those currently collecting benefits and not those who have exhausted their benefits or were denied and remain unemployed. If the federal government looked at quarterly payroll tax data, they would have probably discovered job losses were far higher than reported back in January of 2006 if not further back.
My guess is all the unscrupulous business practices we have only recently learned of began years ago as a response to an already shrinking economy. The result of such practices along with inflation was to keep GDP numbers on the plus side year after year, thus giving the illusion to some that we had a growing economy. Perhaps if we were to have a better accounting of true unemployment and gave it more weight when determining economic health, government would know what is going on far sooner leaving more time to craft and effect well reasoned action. As of late all I have seen government do is act in blind haste with a distaste for the task at hand of which they are (in no small part) responsible.

Posted by Anubis | Report as abusive
 

It seems that it will get worse just for the fact that people are still holding their spending… As this will start a cycle of reduced demand, after Holiday Season, there will be inventory excess and a need to stop production lines. As this takes effect in early Q1 2009, most people will not need to come to work because the 2008 inventories are still unsold. By middle of Q2 2009, we will have reached the bottom of the well, as hopefully something will be done by then by the new gov’t to re-ignite the economy.
If we can get past this stage in Q1 2009, then we will re-experience growth…

 

I think that the cards are being set up for our government to change the USA into a communist nation through our credit system. I was watching the news last night and they gave tips on how to have a “perfect” credit score. Too high of a score will put you at risk, too low will put you at risk. Now the magic number is 680. What the hell? Since when do I HAVE to take out a loan even when I don’t want to just in order to keep my credit score at an acceptable? I didn’t even WANT to get a credit card in the first place. Everthing demands credit now. Are we turning into a communist nation?

Posted by dayshiftbob | Report as abusive
 

Not really sure where these numbers come from. I do not know anyone who is unemployed?

I predict that we will be told the unemployment is 60% and I will still not no anyone who is unemployed.

Posted by chicken_little | Report as abusive
 

The people who SHOULD lose their jobs are Detroits big three bosses! People have voted with their pocketbooks as to the value of their cars. The big three have been making junk for years and the people have spoken. So, why pay them MY MONEY in a bailout? If Washington wants to give those bums money then take it out of Washingtons paychecks not out of my paycheck (tax money). We are paying off the Bankers and politicians who caused our financial mess so why not these incompetent bums in Detroit. Hey Washington, look at all the comments and opinions on the bailout! Don’t think you will be re-elected if you fail to follow the wishes of the people!John

Posted by ginsengjohn | Report as abusive
 

The longest economic “boom” in history must now be followed by the longest economic “bust. It’s only fair! No such thing as a free lunch.

Posted by Yahu Savant | Report as abusive
 

“most people will not need to come to work because the 2008 inventories are still unsold” – Roger Ares
________________________________________ __

Correct, but these people that “will not need to come to work” are in China, Mexico, whatever – just not here. When was the last time you bought apparel made in USA? Toys? Consumer electronics? Furniture? Globalization caused a lot of manufacturing jobs to be exported. But the silver lining thereof is that when the recession is consumer-driven the jobs are lost elsewhere.

There’s a huge inventory overhang in autos. But don’t worry, these are about to be bailed out.

That said, there are still lots of jobs to be lost here because the consumers clam up. But these jobs are mostly service jobs that have nothing to do with inventory accumulation. There’s no way to accumulate uneaten dinners, unwatched shows and movies, dropped premium cable subscriptions, haircuts, and any such services the consumers cut back on. As soon as the customers decide it’s time to spend again, these services will be again in demand, and the jobs will come back almost immediately because there’s no inventory to be liquidated.

So it looks like the only inventory that may affect local jobs is in housing and new construction. But that inventory glut is with us for way over a year now, and eventually will come to an end – after all, the population is still growing, and people need a place to live.

Posted by Anonymous | Report as abusive
 

All your money and jobs went to Asia. This is what negative trade balance means. And your jobs and money still keep going there…

Posted by Ananke | Report as abusive
 

To paraphrase the first Clinton campaign, “It’s the consumer stupid…..” Washington needs to stop paying attention to Wall Street and start paying FULL attention to Main Street. If American Consumers were given the almost Trillion dollars that are being given to the banks, AIG and the now the auto industry, more people could continue to make mortgage payements while their mortages were restructured, folks buried in credit card debt could dig out to a responsible level and then spend wisely, the rest who have been managing debt responsibly could outright spend the money in the economy which would stop the free fall of layoffs because consumer confidence and demand would rebound. Add to this, lower gas prices for a while and things will back on an even keel in relatively short order. If Main Street demand for goods and services rebounds significantly, the stock market will return to Bull status and take care of itself quite nicely. The banks will also follow suit because of an increased inflow of cash. Hello Washington, pipe the money through the consumer to the producer. This is a natural economic flow for success.

Posted by Joe S. | Report as abusive
 

Of course any level of unemployment is bad. I am more concerned about whether or not people make enough to survive given the cost of living and taxation. I just want to point out that giving 1 million people $10 each to do walk around the block is quite different from giving 10 people $1 million each to develop new products. Capital has to overcome a critical threshold to be useful. Putting money into make-work projects is just like throwing money away – the end result being increased debt. We should just reward people really well for the risks they take – maybe by reducing business taxes to zero or permitting more write-offs for research spending (even against personal income). It just seems like everytime a person tries to do something new, there are all sorts of structural disincentives.

Posted by Don | Report as abusive
 

Current unemployment rates—the highest in 15 years—can partially be attributed to federal minimum wage hikes in 2007 and this July. Legislators’ decisions to substantially increase the minimum wage during good economic times now bring unintended consequences for entry-level workers.

Employers (who are seeing demand for their products and services dropping dramatically) are forced to respond to these higher labor costs by cutting positions and staff hours. Sectors that tend to employ a greater number of workers at the minimum wage, such as restaurants, fast-food outlets, and retail stores are the most likely to see layoffs. Some McDonald’s stores in Illinois are testing kiosks for ordering and automated cooking systems that replace minimum wage workers.

The unintended consequence of past minimum wage hikes is job loss for entry-level workers at a time when they need help the most. A job at the previous minimum wage is much better than none at a higher rate.

 

Americans are the ultimate loosers as you buy more and more China make products. Any politician cannot ask openly in public to stop buying China makes in US..that is against international bussiness conduct. As americans dont mind buying chineese make as long as they are cheap..big corporates dont mind moving manufacturing jobs to china to compete is local and international markets. If americans want to stop the job menace stop buying chineese..the govt has already done all it could..it ultimately boils down to consumer selection on how americans spend money.

Posted by Om | Report as abusive
 

What I really love is when EVERYTHING is blamed on the Labor Unions. Can you remember why Labor Unions were formed in the first place? It was to protect the workers that actually produced the goods. The media talks about the labor costs on the new cars are close to $2,000.00. Hmmmm, let’s take the $2K from an average new vehicle, and you’re still looking at $25,000.00! Paste these words into a Google search, ‘Ratio of CEO salary to worker salary’. You find out where the money is going. Big salaries and bonuses are being paid for sending all the jobs to a foreign country.

There is one word to sum up the problem with our country today. G-R-E-E-D! Then, combine that with the fact that this country is drifting away from the foundation it was built on. The United States of America was founded on Christian Principles. Is it really not that clear that the USA is ‘sinking’ as we keep throwing our Christian beliefs overboard? The citizens of this Great Nation better open your eyes and take note as to where we are headed. Even though I did not vote for President-Elect Obama, I will still support the office of President. Those that are quick to blame all this on President Bush need to sit back and think how many times we have been attacked on our soil since 9-11. WAKE UP PEOPLE!

Posted by DollarBill | Report as abusive
 

Minimum wages, coupled with Fed regulations prohibiting kids under 16 from being hired have make summer and part time jobs for young folk non-existent. Thus, no work ethic or experience is created. The minimum wage set the price for illegal immigrants to work for less, and therefore take legitimate jobs away from the US Citizens. The non-enforcement of visa and visitor permits to the US has made the US govenment complicit in the lack of jobs available for the loss of manufacturing and service jobs. The cut backs are part of a shrunken economy…if the economy were to heal, the service and hospitality and retail jobs would return. Whenever a recession occurs, jobs are lost. It is the market reaction, and government intervention will only make it worse until they stop messing with wages and job criteria.

Posted by RUFUS | Report as abusive
 

We experience job cost arbitration. With open trade job losses and earnings decreases will not stop until they equal outsourced ones. Once manufacturing laborers start making 2.50 dollars per day as in Gianghong, there will be no more incentives for outsourcing. Of course, much before that happens half of the American population will be on the streets in civil disorder. So, good luck!

Posted by Ananke | Report as abusive
 

There will be plenty of jobs in new technology. Imagine if we could replace every car truck & bus on the road with a new electric plug-in vehicle. That’s a lot of work and a lot of profit. Also the consumer and the environment win. Less oil and pollution, and lower costs to run.
‘Just Do It’

Posted by Plenty of jobs | Report as abusive
 

Yeah, peeps.

Posted by sally | Report as abusive
 

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