Two Bad Pieces of News in the Jobs Report
Two bad pieces of news in the otherwise tepid jobs report.
**1. The broad unemployment rate rose 0.4 percentage points. **The unemployment rate remained at 9.6 percent in September, but the U-6 rate, a broader measure of unemployment and underemployment, jumped to 17.1 percent. That is the highest rate since April, and only 0.3 percentage points off of the 2009 high of 17.4 percent. The U-6 measure counts unemployed workers, people working part-time who want to work full-time, and discouraged workers who have given up looking for a job but still want one. And the change in the rate is due to a huge increase in workers with part-time jobs who want full-time jobs. From August to September, that number climbed from 8.73 million to 9.34 million. A year ago, it was 8.13 million.
**2. Overall job losses were much higher than economists expected. **The consensus guess among economists was that the economy would add a few thousand jobs in September. Instead, it shed 95,000. What happened? Essentially, economists thought the government would lose fewer jobs and that private employers would add more: They did not accurately recognize the extent of local-government job cuts, and overestimated private employers’ willingness to hire. On top of that, the Labor Department revised its August employment numbers, making the job losses more dramatic between the two months.