Half Full

The Lehmann Letter

Today’s employment report for January from the Bureau of Labor Statistics highlights this recession’s enigma:

http://stats.bls.gov/news.release/empsit.nr0.htm

Is the glass half full or half empty?

“Half full,” say those who focus on the unemployment rate’s drop to 9.7% from 10.0%.

“Half empty,” say those who focus on the 20,000 jobs lost and point out that the economy continues to lose jobs.

But the “half full” folks have time on their side because all the trends are in the right direction.

For instance, the chart below shows that job losses, which exceeded a half-million per month for a while, are now negligible. If the upward trend continues, we’ll be in positive territory before long.

Job Growth

(Click on chart to enlarge.)



Recessions shaded

In addition manufacturing, which had been losing jobs since the recession began in December 2008, finally added jobs in January. This is a sign that some manufacturers, such as auto companies, have sold their excess inventories and are ramping up production again.

Let’s go with “half full.”

(The chart was taken from http://www.beyourowneconomist.com. [Click on Seminars and then Charts.] Go there for additional charts on the economy and a list of economic indicators.)

© 2010 Michael B. Lehmann