November jobs report: Sandy impact muted

(MoneyWatch) The U.S. economy added 146,000 new jobs in November and the employment rate slid to 7.7 percent from last month's reading of 7.9 percent. The results were far better than expected. The Labor Department noted that while Superstorm Sandy caused severe damage in the Northeast, the "survey response rates in the affected states were within normal ranges. Our analysis suggests that Hurricane Sandy did not substantively impact the national employment and unemployment estimates for November."

Using weekly jobless claims as a guide, economists were bracing for a tepid job creation number. The number of people filing new claims for unemployment insurance benefits soared to 451,000 the first week of November, up from an average of 372,000 the previous four weeks. But in the most recent report, the Labor Department said 370,000 people filed new jobless claims last week.

The weekly gyrations echo what occurred to initial claims after Hurricane Katrina. While Katrina was a larger storm, Sandy struck an area with a much denser population, so the impact on employment might be similar. The volatile weekly data spiked then returned to pre-storm trends within two months.

One area where Sandy's impact may have affected the numbers is in unemployment rate. From time to time, there can be a disconnect between the household survey, which is used to calculate the unemployment rate, and the survey of businesses, which determines the number of jobs added or lost for the month. The two reports often move in tandem, but can move in opposite directions, especially in months where there are big seasonal issues at play.

Both surveys are usually conducted based on data from the week of the 12th of the month. For November, the government moved up the household survey by a week to avoid conflicting with Thanksgiving, while the business survey occurred in its regularly scheduled week. That means the household survey was conducted during the immediate aftermath of the storm and many of the respondents could easily have said that they were not "actively looking for work." According to Paul Ashworth, Chief US Economist at Capital Economics "Despite the BLS dismissing the impact of Sandy on payrolls, it was notable that, according to the household survey, 369,000 people couldn't work because of the weather last month, compared with about 64,000 in a normal November."

Maybe some folks would have taken a break from looking for a job, regardless of weather, but the labor force drop of 350,000 meant the participation rate edged 0.2 percent lower to 63.6 percent. As a result, the unemployment rate fell to a near five-year low of 7.7 percent. While it can be tempting to cheer about a lower unemployment rate, this time around, it was for the wrong reason.

What would any discussion about the economy be without a mention of the so-called "fiscal cliff"? Recent surveys indicate that uncertainty over the fiscal negotiations has put a wrinkle in corporate planning and future initiatives. Many companies are waiting to see the final deal on taxes and government spending cuts before allocating capital to new projects or embarking on more robust hiring levels.

Fiscal cliff notwithstanding, the U.S. economy is likely to remain in slow-growth mode well into 2013, a condition that has persisted for almost two years. So far this year, the economy has added an average of 151,000 per month, just slightly ahead of the 2011 pace of 153,000. And as long annual growth is stuck well below 3 percent, the economy will struggle to create the hundreds of thousands of jobs per month required to dramatically lower unemployment.

Unfortunately, many are predicting that 2013 could be the third consecutive year of sub-par growth. According to JPMorgan the expiration of the payroll tax holiday "will reduce U.S. disposable income by $125 billion" which would be a drag on consumer spending and could reduce GDP growth by over half of a percent next year. When the economy is only growing by 2 percent, a one-half reduction is significant.

November jobs:

Jobs created: +146K (Oct: +138K from +171K, Sep: +132K from +148K)

-- Private jobs created: +147K

-- Government jobs lost: -1K

-- Unemployment rate: 7.7% (from 7.9%)

-- Broad unemployment rate: 14.4% (includes the official rate plus "marginally attached workers," those who are neither working nor looking for work, but say they want a job and have looked for work recently; and people who are employed part-time for economic reasons, meaning they want full-time work but took a part-time schedule instead because that's all they could find)

-- Total unemployed: 12 million (from 12.3 million)

-- Long-term unemployed: 4.8 million, representing 40.1 percent of the total unemployed

-- Average duration of unemployment: 40 weeks

-- Participation rate: 63.6 (below the 66% to 67% rate that was normal over the last 20 years; 2/3 of recent decline is due to demographics)

-- Average work week: 34.4

-- Hourly earnings: $23.63 (Over the past 12 months, up 1.7%)

-- Retail: +53K

-- Professional and business services: +43K

-- Health services: +20K

-- Leisure/Hospitality: +23K

-- Construction: -20K (could be Sandy-related)

Editor's note: CBS MoneyWatch initially published an Associated Press story on the unemployment report, which we have since replaced with this staff-written article. You can find the initial AP report and reader comments here.

[alanrobisch]

the pennsylvannia dept of public welfare reported that a mother and two children must earn at least 60000 a year in order to have an equivalent standard of living as a person on assistance earning under 30000 a yr. Gee what a great incentive for a person to go to work. this is typical. I work for SSA which administers a welfare program for the disabled. A couple got married and the payments from them went down. They plan to get divorced. A couple reported their income to me for a better job by the wife when I told them their help would be cut off the the man was infuriated and stated he hated the govt and was going to have his wife get less hours so their payments wouldn't be cut. What a wonderful world we live in. Oh BTW children or adults with special needs trust funds with unlimited amount in them and get welfare and medicaid as can elderlyimmigrants who become citizzens even while living better than most of us Ditto for adult disabled individuals while living in middle class or upper class homes

[alanrobisch]

Much the same news as before the election. we are slouching toward gomorah. NO real increase no real in unemployment and if we went strictly by the number working apparently went down and th unemployment rate went up. No the unemployment rate is a false indicator. the percentage of people who do not have a job went up. this has been a steady pattern under Obama recently. According to Austan Goolsbee former economic advisor there is little the government can do. It must be private enterprise the same private enterprise that the president has attacked. It would seem that those who voted for the president were ignorant when it came to the economy. He has been a consistent failure. IMHO his personal appeal were enough to reelect him no matter how bad things are. It also helped that the MSM tried to bury the truth about BEnghazi and the horrible economy as deep as they could. Strange now that the president is re-elected the MSM now see there is a problem which wasn't there before?

[alanrobisch]

Sir you actually agreed with me but your solutions are wrong. We have strong protection for workers especially in union shops. I work for ssa which has a uninon and in the previous year not one individual was deemed not doing their job well enough to be discharged. Amazing aint it. Gm has a strong union it would be bankrupt now if it weren't for govt bailout. Please explain to me the actions bush administration took to cause the housing bubble to burst or the actions the clinton administration took to cause the dot com bubble to burst. As far as I can see it was a collective effort by govt and we the people that allowed to happen and little to do with the actions of Bush.

Many say it was the irresponsible actions of wall street that caused it. What did bush do to allow this What could he have done to prevent it.

High taxes is a gaurantor to lower economic activity because it takes the money you or I or the rich guy would have to generate economic activity.

Your comparison to post WWII is very poor because we were the only advanced manufacturing power not decimated by WWII. We had an unobstructed ability to make and sell to the rest of the world. We now have strong competition from around the world and as a result higher costing things made here are unsaleable. thus are manufacturing base has difficulty selling goods overseas and even to americans. we are now a service economy. manufacturing jobs will come only if we make better at a good price meaning more efficiency which usually means fewer employees and less beneits for those who are unemployed. Employees cannot simply demand and get better pay and still have the business pass on the cost because other workers in other countries are paid less and make as good or better products Ie Japan and south Korea. OH lets not forget the new economic giant of China.

[alanrobisch]

stolen wealth? why has no one been prosecuted? It would seem to be that better enforcement would have helped to prevent it but for every rule created a new means of evading them appears. Bernie Madoff did steal and is doing time. Whose fault was that. IMHO it was Bernie Madoff and the greedy investors who thought they could get something for nothing Ie unrealistically high returns on their investments.

Humans are by nature selfish and if we can find something or have something to us without our effort we are likely to take it without worrying about where it came from.

You apparently believe that the rich somehow took all our money. this is crazy. Most of the assets that did exist that disappeared was in the value of homes which were inflated by the huge amounts of money being put into the home market by people eager for an easy profit.

Now we are paying the piper with many even responsible borrowers owning homes worth less than the people paid for them and in many cases what they borrowed for them. this borrowing and lending was encouraged by both the fall back insurance provided by fannie mae and freddie mac and that the people who originated the loans had no skin in the game.

There were many reasons for the problem but it is easy especially if you are a democrat to blame Bush and for the average joe it is easier to blame someone else rather than to acknowledge their own mistakes in borrowing unrealistically to buy homes.

[whereismyQE]

QE 1 to infinity = NO JOBS

2009-2012 Extension of Bush era tax cuts = NO JOBS

Massive bank bailout = Historicly high home forclosure rate and NO JOBS

Now republicans/corporations want to force 2 million unemployed people all at once into the worst job market this country has ever seen to save 30 billion dollars over the course of 1 year while Ben Bernanke spends 40 billion per month on god knows what and calls it quantatative easing. On what planet does this make sense? What kinda crack do republicans smoke?

If the Federal Reserve can print money for wall street banks then it can print it for Americans trying to stay in and heat their homes and feed their families while they actively seek work in the worst job market and economy the country has ever seen. They should be doing more not less. The scale back conversation should be had when the unemployment rate has truly gone down to at least 4%. Starving and destroying the middle class is not the answer.

[quantum_analysis]

cranialdisturbance replies: So the President didn't spend 6 trillion dollars we don't have?
-----------------------------------------------------

RZARC2 replies:
No, Congress did in the laws it passed over the last 50+ years. But Bush Jr. definitely put gas on the fire with his unneeded tax cuts, excessive unfunded new spending. Obama like FDR inherited a GOP mess.




So true RZARC2, but the partisan parrots will continue their lies from their propaganda programming.

[Jhihmoac]

All a game of "Give and Take"...Unfortunitely, to get any positive results, you sometimes have to give to those that normally do nothing but take... :P

[ammo17]

all part time jobs hired by ups,fedex and retail stores these numbers are not telling what kind and how long these jobs will last,but by jan.1,2013 they will be gone.

[bobnjersey]

[but over all he was still the greatest president and doesn't decreve to be insulted by people whom don't know the facts and who he was.]
---------------------------------------------
ronald reagan was the one who initiated the 'starve the beast' strategy ... most prominently characterized by low taxes and deficit spending ... the same strategies still promoted by republicans today.

these strategies are the reason for the high deficits we now see ... giving elected officials the ability to promise lower taxes (ie govt revenue to fund programs) ... and to promote programs that satisfy the electorate (either side).

allowing the difference to be made up w/ borrowed dollars isolates the true cost of things from the electorate ... allowing these programs to be proposed and implemented when we can't afford them.

even reagan's own budget director, david stockman, called reagan's policies 'voodoo economics'.

"The second unhappy change in the American economy has been the extraordinary growth of our public debt. In 1970 it was just 40 percent of gross domestic product, or about $425 billion. When it reaches $18 trillion, it will be 40 times greater than in 1970. This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party's embrace, about three decades ago, of the insidious doctrine that deficits don't matter if they result from tax cuts."

http://www.nytimes.com/2010/08/01/opinion/01stockman.html?_r=0

http://nomadicpolitics.blogspot.com/2012/10/the-incredible-hoax-of-reaganomics.html

http://www.thefreedictionary.com/Voodoo+economics

[bobnjersey]

[Reagan improved the economy for years and even went on after his presidency. Obama hasn't improved the economy and even if he has a little it's nothing compared to what Reagan did]
------------------------------
did you miss this part:

"This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party's embrace, about three decades ago, of the insidious doctrine that deficits don't matter if they result from tax cuts."

i know you don't want to accept it ... because it will 'burst you love bubble for reagan' ... but you're obviously stuck in the belief that democrats are the problem ... and republicans are not the issue.

you act as if there wasn't a near complete meltdown of the whole western capitalist economic system ... one that affected the whole world ... not just the united states ... one that occurred before obama's term.

the explosion of the deficit you now see have been in the making for years ... for decades ... beginning w/ reagan's unsustainable economic policies.

he aint the hero you make him out to be ... and history will show that to be true when all the pieces are picked up and an objective assessment is made of what caused everything to fail.

[gman16506]

do you always use opinion pieces as your references???

[bbglow]

Merchants adding jobs to sell foreign made swag for Christmas presents.

You need to check who is sending employment off-shore and importing back. Just how long do you expect it all to float as fewer and fewer are able to buy the foreign swag?

[bbglow]

The ships lined up to unload during the San Diego ship yard strike was very impressive for the "supposed" recession and inability to create jobs.

Insist on US made ... made in the USA!

[quantum_analysis]

CRANIALDISTURBANCE replies: So if somebody invaded this country you wouldn't go into debt to defend it?




So, despite Japan ATTACKING us 71 years ago today, just when was the last time the United States was INVADED? Not by North Korea; not by Vietnam; not by Iraq or Afghanistan either!

But our OFFENSE has liked to fight wars halfway around the world in the name of DEFENSE, and our national security budget is over $1.3 Trillion today, after being quadrupled by the bush/cheney regime over 8 short years!

IF we were INVADED, it would be a different story, so you're just being disingenuous and hypothetical with your INVASION ranting......huh?

[cranialdisturbance]

I was merely seeking clarification. When people make absolute statements like not incurring more debt in the prosecution of any war it make we wonder just how resolved the herald of that message truly is.

[olyboy]

Someone needs to explain to me how an increase of less than 200,000 jobs moves the unemployment percentage. This doesn't pass the smell test. Has CBS lost all journalistice sense?