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Jobs, Jobs, and (less) Jobs ?

07/06/2012

On Monday morning, a survey of economists indicated that the June Jobs Reports issued this morning would show 80 thousand jobs were created last month.  However, on Thursday morning, the ADP report said 176 thousand jobs were created, which was better than expected.  As a result of the ADP report, this morning’s survey of economists showed their prediction had increased from 80 thousand to 100 thousand.  Many prominent labor economists were predicting at least 125 thousand jobs.

Waiting for the announcement this morning, the futures market indicated the Dow would lose about 20 points at the open.  Then, the announcement was that 80 thousand jobs were created, exactly what economists were predicting on Monday.  The futures market then indicated the market would open down about 70 points — a 50 point drop in mere minutes.

That reminds me of  the “recency bias,” which means we are most heavily influenced by the most recent information, before the accuracy of that information is known.

More importantly, it is another grim reminder of how painful our economic recovery from the financial crisis has been.  Don’t forget that almost 15% of our workers are either unemployed or under-employed, which includes people working part-time only because they cannot find full-time work.  That is almost one out of seven workers.  What a huge waste of money!  A day un-worked can never be recovered.  It is lost forever.

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