Back to the main topic. The unemployment numbers were posted today and it seemed like a good portion of the college students became optimistic about the prospect of finding a job. The economy added 120,000 jobs last month, but someone should let them know that the reason the unemployment rate dropped from 9% to 8.6% this month is not because there are that many more jobs which became available over the course of this month, but because people are so frustrated and discouraged with this economy that they have decided to sit on the sidelines. At 64% participation rate in the labor force, we have just experienced the lowest level of participation since the early 1980s. The other element was the number of people who decided to part-time jobs so they could to pay their bills. Both of these factors played into the massive drop in the unemployment rate. Sorry to burst your bubble, but it was going to happen sooner or later!
The good news which came out of today's jobs numbers is that the number of jobs created in September and October were revised up and this had a positive impact on the unemployment rate. Once again I have to be the bearer of bad news: the unemployment numbers tend to be better during the year end due to temporary employment for the holiday season.
- Saliq Khan