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)
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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 DonTo 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.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“most people will not need to come to work because the 2008 inventories are still unsold” - Roger Ares
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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 AnonymousThe 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 SavantThe 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 ginsengjohnNot 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_littleI 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 dayshiftbobIt 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.
- Posted by Roger AresIf we can get past this stage in Q1 2009, then we will re-experience growth…
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.
- Posted by AnubisMy 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.
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 CLOCKWhere’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 LarryNixon 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 LarryThis 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.
- Posted by Dominick VillapianoJust a sign of the Days.
WSOP&NE
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 Nrmwoa 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 .
- Posted by dlbI 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 NoGoodNewsPanic, 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.
- Posted by JerryDoes 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!
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. OrtizThis should not be shocking, and this is only the beginning.
- Posted by Rick