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U.S. unemployment in September 2009: UP to 9.8%

A “random” question crossed my mind today: “Are recessions cyclical because business people fail to learn from history?”

I do not have an answer.

Business people create recessions, and their decisions can also prolong recessions.

The question was sparked by a discussion with a woman who has a Masters in history and  by our agreement that the world would be in much better shape if people learned more from history. Many business folks study little history, and even less science, despite their strong desire to quantitatively examine their unnatural world.

Nonfarm payroll employment continued to decline in September 2009 (-293,000), and the unemployment rate continued to increase, to 9.8%, from 9.7% in August, according to the U.S. Bureau of Labor Statistics report released today. The largest numbers of job losses were in construction, manufacturing, retail trade, and government. Since the start of the recession in December 2007, the number of unemployed people has increased, by 7.6 million, to 15.1 million and the unemployment rate has doubled, to 9.8%.

Unfortunately for the economy, the business decisions to increase unemployment have also taken a toll on the stock market, as stocks declined for a second week amid worries about the recovery that have been spawned by job reports. (If this sounds like business people “shooting themselves in the foot,” it REALLY IS!) It is sad that folks who live their lives in their wallets have such a profound effect on the rest of us. Since many of these folks have not studied much science, they have a hard time distinguishing the (VERY complex) behavior of the man-made world of business from the “real world,” which is governed by natural laws. Also, their apparent inability to learn from history makes them seemed “doomed to repeat it.”

(Update added October 4, 2009: Former Federal Reserve Chairman, Alan Greenspan, said today that the U.S. economy will grow more than expected in the third quarter, but unemployment will continue to increase and will pass 10%. Greenspan expects 3% growth, and possibly even higher,  in the third quarter, up from the predicted 2.5% growth. Greenspan noted that only 40% of the $787 billion in President Obama’s first stimulus package has been spent, and that it is helping to created momentum for economic recovery. “We are in a recovery, and I think it would be a mistake to say the September numbers alter that significantly,” Greenspan said, adding: “This is what a recovery looks like. … It’s premature to act on this type of information.” Greenspan also endorsed some short-term steps to help the unemployment situation, including the extension of unemployment benefits. He is particularly concerned about the number of people who have been out of work for more than six months.)

The Bureau of Labor Statistics report states that:

“Unemployment rates for the major worker groups–adult men (10.3 percent), adult women (7.8 percent), teenagers (25.9 percent), whites (9.0 percent), blacks (15.4 percent), and Hispanics (12.7 percent)–showed little change in September. The unemployment rate for Asians was 7.4 percent, not seasonally adjusted. The rates for all major worker groups are much higher than at the start of the recession.”

“Among the unemployed, the number of job losers and persons who completed temporary jobs rose by 603,000 to 10.4 million in September. The number of long-term unemployed (those jobless for 27 weeks and over) rose by 450,000 to 5.4 million. In September, 35.6 percent of unemployed persons were jobless for 27 weeks or more.”

The number of people who worked part time in September for economic reasons (sometimes called “involuntary part-time workers”) was little changed, at 9.2 million. The numbers of this group rose sharply through the fall and winter but has changed very little since March. (I personally see the lack of increase as a “good thing.”)

Around 2.2 million people were “marginally attached” to the labor force in September 2009, up by 615,000 from September 2008. Among the marginally attached in September 2009 were 706,000 discouraged workers who believe that no jobs are available for them. this figure is UP by 239,000 from September 2008. The other 1.5 million people in the marginally attached group had not searched for work in the past four weeks for reasons such as school attendance or family responsibilities.

Since the start of the recession in December 2007, payroll employment has fallen by 7.2 million. The jobs report has the following news about various TYPES of employment:

“In September, construction employment declined by 64,000. Monthly job losses averaged 66,000 from May through September, compared with an average of 117,000 per month from November to April. September job cuts were concentrated in the industry’s nonresidential components (-39,000) and in heavy construction (-12,000). Since December 2007, employment in construction has fallen by 1.5 million.

Employment in manufacturing fell by 51,000 in September. Over the past 3 months, job losses have averaged 53,000 per month, compared with an average monthly loss of 161,000 from October to June. Employment in manufacturing has contracted by 2.1 million since the onset of the recession.

In the service-providing sector, the number of jobs in retail trade fell by 39,000 in September. From April through September, retail employment has fallen by an average of 29,000 per month, compared with an average monthly loss of 68,000 for the prior 6-month period.

Government employment was down by 53,000 in September, with the largest decline occurring in the non-education component of local government (-24,000).

Employment in health care continued to increase in September (19,000), with the largest gain occurring in ambulatory health care services (15,000). Health care has added 559,000 jobs since the beginning of the recession, although the average monthly job gain thus far in 2009 (22,000) is down from the average monthly gain during 2008 (30,000).

Employment in transportation and warehousing continued to trend down in September. The number of jobs in financial activities, professional and business services, leisure and hospitality, and information showed little or no change over the month.

In September, the average workweek for production and nonsupervisory workers on private nonfarm payrolls edged down by 0.1 hour to 33.0 hours. Both the manufacturing workweek and factory overtime decreased by 0.1 hour over the month, to 39.8 and 2.8 hours, respectively.”

“The change in total nonfarm payroll employment for July was revised from -276,000 to -304,000, and the change for August was revised from -216,000 to -201,000.”

The current economic climate seems ruled by people who will not take GOOD news for an answer. I hope that they change their minds, soon. This is BUSINESS, not SCIENCE, after all.

-Bill at Cheshire Cat Photo™

You can view higher-resolution photos (*generally* 7-30 megabytes, compressed) at the Cheshire Cat Photo™ Pro Gallery on Shutterfly™, where you can also order prints and gifts decorated with the photos of your choice from the gallery. Apparel and other gifts decorated with some of our most popular photos can be ordered from the Cheshire Cat Photo™ Store on CafePress®. Both Shutterfly™ and CafePress® ship to most international locations worldwide! If you don’t see what you want or would like to receive an email when new photos are up on the site, send us an email at

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