Welcome news: The consensus estimate of 44 experts surveyed by Bloomberg is that the economy lost 170,000 net jobs in September. For August, that figure was 216,000. In other words, these experts believe the jobless situation continues the trend of getting worse less fast.
A vast improvement over the slaughter of the early months of this year when six to seven hundred thousand people were losing their jobs every month. However, while the situation is less bad month to month, the accumulated job losses keep piling up.
That consensus figure of 170,000 marks the median of those experts. Their individual guesstimates cover a wide (though uniformly negative) range - from a loss of 235,000 to a loss of 135,000. As Friday approaches and the announcement of the official unemployment numbers by the Bureau of Labor Statistics draws closer, you can expect this consensus will move up or down, as the experts tweak their predictions.
Wherever those BLS numbers come in, they will represent tens of thousands more Americans who no longer earn a paycheck. The lucky ones - about 40% - will collect unemployment benefits and, if they aren't out of work long enough to exhaust those benefits, may squeak by until hiring begins again. In August, according to the BLS, the exhaustion rate, the percentage of people who have used up their benefits, has hit a record high of 52.40%.
The New York Times reported Sunday just how bad hiring is going these days. For every job opening, there are now six people looking for work. (The folks at the Economic Policy Institute pointed this out when the stats were released two and a half weeks ago.)
Click for a larger version of this Economic Policy Institute chart.
During the last recession, in 2001, the number of jobless people reached little more than double the number of full-time job openings, according to the Labor Department data. By the beginning of this year, job seekers outnumbered jobs four-to-one, with the ratio growing ever more lopsided in recent months.
The calculation of six job seekers for every job opening comes from the BLS's monthly JOLTS report, aptly named in this Great Recession. It's the acronym of the Job Openings and Labor Turnover Survey. It's always a month behind the unemployment report. The August numbers won't be out until next week. But based on the official unemployment stats that we saw four weeks ago, we already know there will be at least 6.2 job seekers for every opening in the next JOLTS report.
As has been noted so many times, all these numbers understate the actual state of unemployment. While 14.9 million are officially counted as out of work in what pundits like to call the "headline" number, the underemployed and discouraged workers who aren't accounted for in that headline bring the grim tally up to around 26 million.
It could be worse. Without a doubt, if the congressional Republicans had had their way last February, the situation would be worse. But just because things could be worse can't be expected to stop the millions out of a job from asking when things will actually get better, when they will stop bleeding through the bandage. Not soon is a common refrain. From the Times:
"There’s too much uncertainty out there," said Thomas A. Kochan, a labor economist at M.I.T.’s Sloan School of Management. "There’s not going to be an upsurge in job openings for quite a while, not until employers feel confident the economy is really growing."
Even after companies regain an inclination to expand, they will probably not hire aggressively anytime soon. Experts say that so many businesses have pared back working hours for people on their payrolls, while eliminating temporary workers, that many can increase output simply by increasing the workload on existing employees.
"They have tons of room to increase work without hiring a single person," said Heidi Shierholz, an economist at the Economic Policy Institute. "For people who are out of work, we do not see signs of light at the end of the tunnel." ...
"It’s going to take quite some time before we see robust job growth," said Tig Gilliam, chief executive of Adecco North America, a major job placement and staffing company.
There's a special kind of problem that appears when people wait a long time before being rehired or finding a new job. As Conor Dougherty wrote recently in The Wall Street Journal:
About five million of the jobless are what economists class as "long-term unemployed," people who have been out of work for 27 weeks or more. As challenging as it is for anyone to find a good job in this economy, it can be even harder for people out of work a long time.
Skills atrophy. Demoralization sets in and can become permanent. Some potential employers shy away. ...
The probability that a laid-off worker will find a job grows smaller the longer people have been out of work, according to studies in the 1980s by economists Lawrence Katz of Harvard University and Bruce Meyer of the University of Chicago. "Someone unemployed for six months is much less likely to find a job in the next month than someone unemployed for one month," Mr. Katz says.
Right now, the percentage of unemployed Americans who have been out of work for six months is 33%, the highest since World War II.