Restrained Hiring and Moderation in Job Loss Expected for Q4 2009

"CareerBuilder and USA TODAY’s Q4 2009 Job Forecast shows that, while employers are feeling more optimistic about the economy and job market, the majority plan to keep their staff levels the same for the remainder of the year. Continued moderation in job loss coupled with a hesitant approach to hiring is expected for the fourth quarter, according to the survey, which was conducted by Harris Interactive® from August 20 to September 9, 2009. More than 2,900 hiring managers and human resource professionals across industries participated nationwide.

Companies are switching their focus from cost containment to growth. Employers who have instituted pay cuts or layoffs in the last year are reporting that they have begun to restore compensation levels and rehire employees," said Matt Ferguson, CEO of CareerBuilder. "While these are positive indicators, the pace of hiring will remain restrained. It will take time to rebuild the confidence needed in the nation’s economy to trigger more robust recruitment programs."

Source: CareerBuilder

ADP Reports: US Private sector cut 254,000 jobs vs. expectation of 200,000 for Sept

"Private-sector firms in the U.S. cut 254,000 jobs in September, according to the ADP employment report released Wednesday. 

In August, a revised 277,000 jobs were lost compared with the 298,000 originally reported, ADP said.

Goods-producing jobs fell by 151,000, including 71,000 in manufacturing and 73,000 in construction. Services-producing jobs fell by 103,000.

"Employment losses have diminished significantly over the last two quarters," said Joel Prakken, chairman of Macroeconomic Advisers, the economic firm that produces the ADP report from payroll data provided by Automatic Data Processing, Inc.

According to ADP, 7.1 million private-sector jobs have been lost since the recession began, in line with the 7 million lost in the Labor Department's estimate through August.

52% of Unemployment Benefits Expired

With the recent US government data from the source below over half of those that qualify for unemployment has there benefits expired. There continues to be significant weakness in the labour markets. Although, there has been a slight rebound in jobs lost jobs are not created at the level that leads to growth. Presently there are two million college educated graduates unable to attain jobs, let alone the countless numbers with experience and skills who continue to face grave job market conditions. Once this stimulus works itself through the system and does not create the types of sustainable job growth look for this economy to continue to trend down. 

Source: http://ows.doleta.gov/unemploy/claimssum.asp

Why Paychecks Could Shrink

"High unemployment and low inflation may lead to a decline in pay—and that could slow the recovery

For now, pay is still rising—a little less than 2% for the year through June 2008, according to the government's employment cost index. But the weak job market is creating the perfect conditions for a decline in pay: low inflation and high unemployment (9.7% in August). With a huge reserve army of unemployed—more than 2 million of them college-educated—it would be easy for many employers to demand concessions.

One of Wall Street's more bearish forecasters, Goldman Sachs chief U.S. economist Jan Hatzius, predicts that average hourly earnings will fall about half a percent from the fourth quarter of 2009 through the fourth quarter of 2010. Hatzius says his prediction accounts for workers' strong aversion to wage cuts. Without that adjustment, the projection would be negative 2%." 

 Source: Business Week

Initial Claims & Continuing Claims

On the 24th, US data will be released concerning initial claims and continuing claims. The market expects 550,000 for initial claims, and continuing claims at 6.1 Million.

UPDATE: 

The week ending Sept. 19, the advance figure for seasonally adjusted initial claims was 530,000, a decrease of 21,000 from the previous week's revised figure of 551,000. 

4-week moving average was 553,500, a decrease of 11,000 from the previous week's revised average of 564,500. 

Number for seasonally adjusted insured unemployment during the week ending Sept. 12 was 6,138,000, a decrease of 123,000 from the previous week's revised level of 6,261,000.

The interesting news this past week is that the US may provide additional extension of benefits for 27 high unemployment rate states. This means that the government pretty much has acknowledge that unemployment will persist to be a on going problem. Some estimates have come in that unemployment may continue to be at elevated levels till 2011.

So initial claims dropped a bit while more then what the market expected, however continuing claims was more then what the market had expected. Short term wise employment is slowly improving, while longer term structural employment continues to be weak.

Jobless recovery till December?

A key index shows that an economic recovery is having trouble gathering steam. It also hints that employment won’t edge up until the end of the year.

The nonprofit Conference Board’s Employment Trends Index fell slightly in August, down 0.1 percentage point from a revised July number. The index now stands at 88.1 and is down 18.5% from a year ago.

“The flatness of the (index) in recent months suggests that we won’t see job growth until the end of the year,” said Gad Levanon, the group’s senior economist. “The fact that the index cannot get off the ground is another sign of a weak recovery, perhaps a jobless one.”

Source: Conference Board

Weekly Jobless Claims Down, Continuing Claims Rise

The Labor Department has come out with its weekly jobless claims, and we are current faced with a very weak market for job growth. Numbers were down 12,000 revised to 545,000. The consensus was 575,000, while the prior figure last week was 550,000 on an unrevised basis and went up to 557,000.

The four week average fell by 8,750 to 563,000.  Continuing claims for the unemployed continues to rise, the figures rose by 129,000 to 6.23 million.  The figures from the prior week would have rose even more if Labour Day wasn't present.

1 out of 10 are out of work on a official figure basis, while 1 out of 10 are either working part-time or under employed. Weekly jobless figures have to be down to 400,000 to see a healthy economy develop.