Are Jobs Coming Back? Signs Point to Yes

Is the job market getting better? That is what is being suggested in this article. In the report from the Bureau of Labor Statistics for October stated that 151,000 new jobs had been created that month. The hope was that just as many jobs would be created during the month of November as well. One economist even suggested that there would be as many as 235,000 jobs added during November. The reason behind the thinking that the job market may be turning around is that monthly payroll numbers were up and less people have filed for unemployment. However, the increase in payroll numbers could simply be coming from an increase in temporary positions that have been created which will eventually end causing those people to become unemployed once again.

The article states that fewer people are relying on the benefits and that the four-week moving average has fallen to a two year low. Also, the people who are employed are on average working more during the week. If this trend continues then businesses may have to decide if they want to overwork their current employees or hire new ones. The hope is that the demand for new workers will soon rise high enough to really start making a dent in the unemployment rate.

Even though there has been an increase in the monthly payroll numbers, many jobs have still been cut, most of them from government agencies. In October almost 11,000 jobs were cut and they are predicting 48,711 job cuts during November. How can the job market be getting better if they are cutting almost 50,000 jobs in a month? With this many job cuts in a month it will only increase the unemployment rate causing the supply of workers for the labor force to increase drastically while the demand for workers will still be very low.

Ben Bernanke the Federal Reserve Chairman stated that the economy is not growing fast enough to really reduce the unemployment rate. Economists expect the unemployment rate to stay above 9% at least though 2009. Today the Bureau of Labor Statistics released its monthly report concerning the unemployment rate for the month of November and it showed that unfortunately the unemployment rate that had been holding steady for the past few months at 9.6% had in fact increased to 9.8%. Also, the number of new jobs that had been created was nowhere close to what was predicted for the month. Seeing the report shows that maybe the job market is not moving in the right direction after all.

http://money.cnn.com/2010/12/02/news/economy/november_jobs_report_lookahead/index.htm