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alstry (< 20)

Any Jobs Out There? Anyone Anyone



February 10, 2008 – Comments (7)

As this blog is written, unemployment is being reported at something less than 5%.

But if you are an independent contractor, you don't count.  You think there are more independent contractors today than 10 years ago.

 If you have been off work for 6 months, you don't count.  Anyone you know?

 Macy's just released over 2000.  Bear Sterns just notified that 10% it its workforce will be hitting the road.  Home construction is down 50%(housing was a BIG component of job creation over the past five years).  The Governator just notified that his state MUST cut 10% of its budget accross the board...and he runs a very very big state. 

 Retailers are reporting very negative same store sales and closing thousands of stores around the country.  The big boys, WalMart, Target, and HomeDepot are delaying new store openings.

 Mortgage companies have shut down by the thousands over the past year.  Real Estate agents are exiting the profession by the tens of  thousands.  Auto manufacturers are contracting.  So are the suppliers to the manufacturers.  Auto Dealers are going out of business.  Truckers are just shutting down their equipment.  Commercial vacancy rates are rising forcing landlords to cut back.  Major construction projects are defaulting midstream idling workers.  Restaurant sales slowing forcing cutbacks.

 When the above people are let go, their spending power deminishes hurting other businesses and tax revenues in their respective communities forcing even more layoffs.  Just as growth creates more growth, contraction is like dominos falling causing other dominos to fall.

 Wages stagnant, costs skyrocketing, earnings evaporating, and now the layoffs are beginning for business struggling to preserve margins and for governments trying not to dig too deep a hole.

If just 10% of the current workers are released, unemployment will skyrocket to 15%.  What if 15% of the current workforce loses their jobs?  Now, how much will home prices fall to be affordable?

Is anyone thinking out there anymore?

 Sweetie, why is the water rising so high on the beach?

7 Comments – Post Your Own

#1) On February 10, 2008 at 12:11 PM, floridabuilder2 (98.09) wrote:

The last I looked UE dropped from 5% to 4.9%....  we may hit 6% tops........

Extremist are right once every century.........  and it is no way to live..........  back in the 80s people were running around in my army reserve unit talking about a nuclear war with Russia and buying canned tuna and burying guns.......... i'm sure that canned tuna is still in their reinforced basement and those guns are still buried in save havens around Michigan........  I'm still waiting for the nuclear war....................

guns and canned tuna weren't good investments in 1980..... just like I don't believe we are going into an economic crisis of unprecedented proportions that you believe will happen.........

not one of my friends is unemployed......... I grew up in Detroit area all my friends work in auto related jobs........... and none of them are unemployed.......... the high unemployment are the disenfranchised inner city blacks in Detroit.... anyone who can't find a job has left the state for the smile states

 I'm glad you joined caps, now lets see how good of a stock picker and predictor of macro economics you really are!

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#2) On February 10, 2008 at 2:34 PM, MakeItSeven (31.68) wrote:


You don't have to use annecdotal evidence.  You can mathematically prove that it is worse than it seems by using the data on the Labor Participation Rate obtained from the BLS. 

- From the Jan 2001 data when Bush first took office unemployment was 4.2% and LPR was 67.3%.

- From the latest Jan 2008 data, unemployment rate was 4.9% and the LPR was 66.1%.

Assuming the lower LPR is due to people who want to work but are not considered "actively looking for work" now because of the job market, then the 1.2% difference in the population in the LPR will translated to 1.8% of unemployed people, assuming the same 67.3% LPR as in 1/2001.  So, the unemployment rate right now should be 6.7% if we don't ignore all the people who used to want to work before.

However, the unemployment rate comes from household survey (as opposed to the job losses/gains which come from the payroll survey) so I think it takes into account contractors.

It does hide the number of under-employed people since they have no choices though, like flipping burgers for 2 days/week.  They are still counted as employed even with no health insurance and can barely survive.

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#3) On February 10, 2008 at 3:02 PM, alstry (< 20) wrote:


I have been intellectually challenged most of my life.  If its too complicated, I just can't figure it out.

 Based on the expert data I have reviewed, it seems about 4-6 million jobs were created as a direct and indirect consequence of the housing boom.  Simply reverting back to pre boom times loses about 5 million jobs.  That is a lot of extra homes potentially coming to market.  If they arm swings back even futher, which is likely after such an enormous boom, than 6-8 million job losses are likely simply as a direct and indirect result from a housing contraction. 

 You can already count millions in construction, hundreds of thousands in sales, and hundreds of thousands in finance without looking too hard.  Can you imagine how much higher we go just adding in suppliers.

 I know you have hundreds of thousands of dollars worth of "professional research" at your disposal, however, in a few months I think you will find my perspective much more accurate.

 I started posting now because I think we are at the point of no return.  Each week, week after week, the news coming out will likely be more and more negative.  We may have a few days of rest, but the bad news will come showering back.

 Remember those people in Indonesia who ventured back on to the beach when the first wave of the Tsunami retracted back into the ocean?

 My friend, you are about to enter a once in a century era....and at least you will have some comfort knowing you had advance notice for free from the wonderful community at

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#4) On February 10, 2008 at 3:14 PM, EScroogeJr (< 20) wrote:

I have a suggestion. What happens if we adjust the unemployment rate for hedonics. Think of it, people still holding jobs during this downturn must appreciate having a job much more then they did when things were rosy. Let us assume, as a plausible hypothesis, that the 95% who are employed derive a 5% greater enjoyment compared to year ago. Then we can say that the Bush administration has achieved a nearly full employment, can we not? I suggest that the Department of Labor should incorporate hedonics into its unemployment statistics.


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#5) On February 10, 2008 at 3:35 PM, mickeyc21 (30.00) wrote:

Escrooge - thats brilliant! You have a grand future as a CPI economist.

Alstry - Nothing is complicated despite peoples attempt to over think issues. Employment is being decimated right now.

fb - I have seen unemploment that truly amazes me across the West considering how early we are in a down cycle. 

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#6) On February 10, 2008 at 4:00 PM, MakeItSeven (31.68) wrote:


Employers have already taken into account the hedonic factor and give their employees raises which are half of the inflation rates.  And those employees are still hedonically happy that the raises are not pink slips. 

If the government takes hedonics into account again then it will be like double-taxing.  It's unfair. 

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#7) On February 10, 2008 at 4:07 PM, EScroogeJr (< 20) wrote:

I protest! Hedonically-adjusted prices is one thing, and hedonically-adjusted employment is quite a different beast!

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