Jobs Created Across Economic Sectors; Income, Federal Deficit Drop
- Dec 09, 2013
A number of major sectors of the economy created jobs in November, according to the mostly positive jobs report on Friday by the Bureau of Labor Statistics. Health care employment, for instance, was up a net of 28,000 positions, and manufacturing jobs increased almost as much, by 27,000 jobs. Professional and business services continued to trend up (by 35,000), and the construction industry added 17,000 positions. Federal government employment went the other way, however, dropping by a net of 7,000.
The BLS report also says that retailers added 471,000 workers in November (that’s not a seasonally adjusted total, since retailers always hire more in November than any other month). That level of seasonal hiring is almost as much as last year, and pretty close to “normal” levels – that is, pre-recession. Retailers seem to be anticipating a good, if not stellar, holiday sales season.
The official unemployment rate – the headline number, that is – got a fair amount of attention, dropping from 7.3 percent in October to 7 percent in November. The more comprehensive unemployment rate, which the BLS calls U-6, also continues to drop, coming in at 13.2 percent in November, compared with 13.8 percent in October, and 14.4 percent a year ago. The U-6 includes not only people looking for work, but those who aren’t current looking, and people who are at part-time jobs but want full-time ones.
The total number of unemployed persons was down as well, to 10.9 million in November compared with 11.27 million in October and 12.04 million a year earlier. Some of the month-over-month drop, but not all of it, was because of furloughed federal workers returning to their jobs. The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 4.1 million in November, accounting for 37.3 percent of the unemployed. Still, the number of long-term unemployed has declined by 718,000 over the past 12 months.
Income Drops, So Does Federal Deficit
Personal income decreased $10.8 billion, or 0.1 percent in October compared with September, according to the Bureau of Economic Analysis on Friday (normally, the BEA would be reporting on November by now, but it’s still catching up on its reports). Personal consumption expenditures (PCE), which is what the government calls people out buying things, increased $32.7 billion, or 0.3 percent.
Real PCE — PCE adjusted to remove price changes – also increased 0.3 percent in October, compared with an increase of 0.1 percent in September. The price index for PCE decreased less than 0.1 percent in October, compared to an increase of 0.1 percent in September, so inflation is essentially nugatory right now. The PCE price index excluding food and energy increased 0.1 percent in October, the same increase as in September.
Separately, the Congressional Budget Office reported on Friday that the federal government ran a budget deficit of $231 billion for the first two months of fiscal year 2014 – October and November of this year – which was $61 billion less than the shortfall recorded in October and November of 2012. The CBO projects that the deficit will be 3.3 percent of GDP in fiscal 2014, down from 4.1 percent in fiscal 2013, and it might even be less than that, if there are more months ahead like October and November.
Wall Street responded to Friday’s jobs numbers with some oomph, with the Dow Jones Industrial Average returning above 16,000 by gaining 198.69 points, or 1.26 percent. The S&P 500 was up 1.12 percent and the Nasdaq advanced 0.73 percent.