Hello Recession!

The jobless rate has jumped to 6.5% in October which is a 14 year high. Also, the non-farm payroll fell by 240,000 in October.

October’s drop in payroll employment followed declines of 127,000 in August and 284,000 in September, as revised.

I think it is fair to say the probability that the U.S. is in a recession is now greater than 50%. Employment/unemployment are lagging indicators, so when you hit ten months in a row of steadily declining job numbers (for the non-farm payroll) it is really not a good thing.

Employment has fallen by 1.2 million in the first 10 months of 2008; over half of the decrease has occurred in the past 3 months. In October, job losses continued in manufacturing, construction, and several service-providing industries. Health care and mining continued to add jobs.

We also have the chain store sales down sharply in October as well. Further, this is continuation of an on-going downward trend that started in June of 2008. The last time the chain store sales were negative was in March of 2008 and that was due to technical issues (a calendar shift).

FILED UNDER: Economics and Business,
Steve Verdon
About Steve Verdon
Steve has a B.A. in Economics from the University of California, Los Angeles and attended graduate school at The George Washington University, leaving school shortly before staring work on his dissertation when his first child was born. He works in the energy industry and prior to that worked at the Bureau of Labor Statistics in the Division of Price Index and Number Research. He joined the staff at OTB in November 2004.

Comments

  1. Drew says:

    Yes, the long predicted – almost two years running now – recession most assuredly has arrived. Those retail sales numbers are really tough.

    One has to wonder if this will be short and sharp, due to the credit lockup, or long and protracted.

    Good luck to Mr. Obama. Syrupy speeches full of “hope,” and “change” don’t go far in the real world. I’m thinking that deep sixing those tax hike pledges might.

  2. Triumph says:

    Hello Recession!

    I am christening this the “Obama Recession” right now so we know where to place the blame.

  3. Dave Schuler says:

    The chain stores article is misleading since the experience varies somewhat among mass retailers.

    Everyday low pricing retailers that aren’t mostly dependent on apparel, e.g. Wal-Mart, are doing okay while those who aren’t discounters and/or mostly sell apparel are suffering, e.g. Abercrombie and Fitch and Target which although a discounter depends largely on apparel.

  4. Triumph says:

    Wal-Mart, are doing okay

    The main reason Wal Mart is doing ok is because they have an exclusive on the new AC/DC album

  5. Michael says:

    The main reason Wal Mart is doing ok is because they have an exclusive on the new AC/DC album

    Good to see you’re back on your game, Triumph.

  6. James M. says:

    As a Wal-Mart employee, I can state we are doing o.k. because of the fact we sell a large assortment of merchandise including a lot of necessity items. However our sells are down in the areas where we traditional make most of our markups in the impulse buying area. So I feel we will be o.k. overall but if the economy continues to lag over an extended amount of time then we face issues with cuts in employee hours, which has already occurred with no over 38 hour weeks, and possibly layoffs. Right now we are placing a lot of hope in the Christmas season coming up. Whether it will perform at our least expectations is still to be seen.

  7. tom p says:

    Right now we are placing a lot of hope in the Christmas season coming up. Whether it will perform at our least expectations is still to be seen.

    Hate to say it James, but I think you are in for a world of hurt…

  8. G.A.Phillips says:

    Hate to say it James, but I think you are in for a world of hurt…

    yup start applying for a city, state, or Federal job now and make sure to take off you flag pin and find one that says Obama 2008.