Job Losses Worse Than Expected

Economic Indicators SeptSeptember’s job losses were worse than economists expected, dampening Wall Street’s hopes for a happy ending to the week and keeping stocks in the doldrums. If there was any good news it was that market indexes avoided a freefall.

The U.S. Bureau of Labor Statistics reported that employers cut 263,000 jobs last month, a number 40-50 percent higher than economists expected. A Reuters poll predicted the non-farm payroll losses would be about 180,000 jobs, while a Bloomberg News estimate put the number closer to 1750,000 and one of the more optimistic estimates by MarketWatch expected a loss of 167,000 jobs.

The losses pushed the unemployment rate to 9.8 percent.

Among the biggest losers were construction jobs, down by 64,000 jobs; government, down by 53,000 jobs, and manufacturing, which lost another 51,000. The only significant gains came in healthcare, which added 19,000 jobs.

In more human terms, the BLS numbers mean that officially almost one in 10 American workers doesn’t have a job. But the numbers don’t include those who have given up looking for a job, those who didn’t actively seek work in the four weeks prior to the survey, and those who took part-time work because they couldn’t find anything.

In the parlance of the BLS, those are America’s discouraged workers and the marginally attached and the involuntarily part-time. Add them to the 15.1 million who are officially unemployed and the number is 26.5 million.

When you consider that the total workforce is 154 million, then the distressed workers represent 17 percent, or one in six.

Then there are the workers who the government no longer counts in any form. These are the people who had jobs, but don’t now and no longer consider themselves in the workforce.  In September, that percentage declined by .3 to 65.2, while the percentage of the total U.S. population that is employed — the so-called employment-population ratio — stands at 58.8, down almost 4 points since the start of the recession in December 2007.

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Where have they gone? Those at retirement age may have retired; younger ones who would have taken jobs may now be opting to stay in school, join the military, or take volunteer assignments, while other workers have opted to return to school. Other data suggests, however, that it may be younger workers who are hardest hit. They have less seniority and fewer skills.

Numbers from the BLS and the Census Bureau show that older workers are opting to remain in the labor force longer.

What these data points mean for recruiters who are still recruiting is that the tsunami of inbound resumes and applications is only to going to get worse. Within each batch though you’ll find increasing numbers of skilled, older workers — the “over-qualified.” Don’t overlook them.

The “Talent Sourcing Forecast” survey from TalentDrive found, not surprisingly, that 51 percent of the surveyed companies said “filtering through the mass of resumes and increased number of applicants” was their No. 1 challenge. But, in those heaps and piles, reported 54 percent of the companies, were candidates who met or exceeded their expectations.

employment-population ratio

John Zappe is the editor of TLNT.com and a contributing editor of ERE.net. John was a newspaper reporter and editor until his geek gene lead him to launch his first website in 1994. He developed and managed online newspaper employment sites and sold advertising services to recruiters and employers. Before joining ERE Media in 2006, John was a senior consultant and analyst with Advanced Interactive Media and previously was Vice President of Digital Media for the Los Angeles Newspaper Group.

Besides writing for ERE, John consults with staffing firms and employment agencies, providing content and managing their social media programs. He also works with organizations and businesses to assist with audience development and marketing. In his spare time  he can be found hiking in the California mountains or competing in canine agility and obedience competitions.

You can contact him here.

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2 Comments on “Job Losses Worse Than Expected

  1. Perhaps you caught Alan Greenspan’s comments on Sunday that he is concerned about the number of workers who have been unemployed for more than six months, BECAUSE THEY ARE PERMANENTLY LOSING SKILLS! As if it is not hard enough for the long term unemployed already, Greenspan announces that essentially the longer you have been looking, the less capable you are.

    I utterly reject this notion. [I am not unemployed, BTW.] In my opinion, most workplace competencies are either innate or are as permanent as learning to swim or ride a bike.

    This man is clueless. He is the person that said we don’t need to regulate banks because it is in their self interest not to make bad loans. And now he has slimed the very people who need a kind word and a leg up.

    Please join me in denouncing this travesty.

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