October Employment Report: Alternate Takes

Last Updated Nov 8, 2010 4:19 PM EST

Are we gaining new jobs or not?

David Rosenberg, the outspoken economist at wealth managers Gluskin Sheff in Toronto, reminds us that the Labor Department's monthly The Employment Situation is a report, drawn from two complex surveys, rather than just a headline. He points out statistics that don't square with the media's optimistic read, as well as inconsistencies. For example:

If not for the slide in the labour force last month, the unemployment rate would have gone back up to 10%!
Indeed, the size of the labor force, including people working and seeking work, fell 254,000 in October, and stands today about where it did a year ago, even though the U.S. population is larger by 2 million people.

The number of people employed declined as well, by 330,000 -- far more than the jobs created.

Rosenberg also notes:

[T]he participation rate fell from 64.7% in September to 64.5% - the lowest level since November 1984! How is that bullish?
This graph shows the decline in participation, that is, the proportion of the population working.

Also he notes that full-time employment has been falling since early in the year.

Geez, what a downer. Let's take a look at a positive alternative view, from The New York Times Economix blog. David Leonhardt contradicts economist Brad DeLong, who contends that "there was no economic recovery earlier this year, so it's wrong to say that the recovery faltered." He offers this graph, which pulls the whole part-time Census thing out of the numbers of net new jobs:

What to make of this? Recovery or not? I will just say that at a turning point, which is where the U.S. economy stands, at least in employment turns, there are plenty of conflicting signals. But at least we are no longer headed down.