Today, the U.S. Bureau of Labor released the November job numbers report…and what a report it was! A total of 146,000 jobs were created in November and the “official” unemployment rate in the U.S. economy decreased to 7.7% from 7.9% in October (I’m sure politicians will have a heyday with this news—telling Americans they are getting people back to work). But the devil, dear reader, lies in the details of the job numbers report! This is a classic example of a report looking good on the surface, but when you look inside, you say, “What just happened here?” The underemployment rate stands at 14.4%– nothing to be excited about. Unlike the official unemployment rate, the underemployment rate includes those people who have given up looking for work and or have part-time work because they can’t find full-time work. The structure of the labor market is still wounded, no matter what you hear on the mainstream media outlets. Looking at the statistics within the job numbers report, people are finding work in low-paying sectors like retail and healthcare. There have been 140,000 jobs created in retail sector in the last three months and 53,000 of them were created in November! And, while we’re hearing or reading that the housing sector is coming back, the job numbers report says that 20,000 jobs were lost in construction in November! Now here comes the real kicker in the job numbers report… The average time a person is unemployed is continuously going up. In November, the average unemployed person in the U.S. economy was without a job for 40 weeks! This number has skyrocketed since the beginning of 2010. The average time a person was unemployed in January 2010 was 30.3 weeks. (Source: Federal Reserve Bank of St. Louise, November 2, 2012). There are currently 4.8 million people in the U.S. economy who are long-term unemployed. The chart below is a scary one. It shows the continuing rise in the time it takes someone to find a job in the U.S. economy. In January 2000, it took 13.1 weeks for a person to find a job; today, it takes 40 weeks. Copyright Lombardi Financial 2012; Data source: Federal Reserve Bank of St. Louis Dear reader, the official unemployment rate going down may be welcome news to the layperson. But sadly, when you look at the details within the job numbers report, a deteriorating picture of the overall labor market in the U.S. economy is painted. With companies seeing their corporate earnings growth decline in the third quarter of 2012, it won’t be too long before they start cutting costs and laying off employees again. This economist, for one, expects a worse ... Read More