Explaining Southern California's economy

September jobs report: Another lackluster month?

A jobs sign hangs above the entrance to

KAREN BLEIER/AFP/Getty Images

A jobs sign hangs above the entrance to the US Chamber of Commerce building in Washington, DC. The September jobs report due our tomorrow could improve on August, but not by much.

The Labor Department will release it September jobs report bright and early Friday morning, and as usual I'll be on the dawn patrol to consider the numbers. Last month's payroll report was disappointing; the economy added only 96,000 new jobs in August.

September could be better. The ADP report that comes out ahead of the official U.S. government release said the economy added 162,000 new jobs in the month. But a consensus from economists surveyed by Bloomberg expects only 113,000.

With growth as weak as it is in the U.S., another sub-200,000 Labor Department report shouldn't be surprising. If we want to add 200,000 jobs per month — the pace at the beginning of the year — we need GDP growth of 2 percent. In the second quarter of this year, however, we only saw GDP growth at 1.3 percent. That's just not good enough to enable this sluggish recovery to pick up speed.

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August jobs report: Will the U.S. add 200,000 jobs?

A jobs sign hangs above the entrance to

KAREN BLEIER/AFP/Getty Images

A jobs sign hangs above the entrance to the US Chamber of Commerce building in Washington, DC.

As I reported this morning, ADP, a private payrolls processor, said that 201,000 jobs were added to the U.S. economy in August. This contrasts with the 90,000-170,000 that economists surveyed by Bloomberg are expecting and would be a decent jump from July's 163,000 figure (that number beat expectations, by the way).

Regardless of who's number you think is most plausible, the unemployment rate, currently at 8.3 percent, isn't likely to move much, even if we're closer to ADP's figure than we are to the lower end of the Bloomberg survey.

That doesn't make tomorrow's report sound very exciting. But, actually, it is.

The Washington Post summarizes rather neatly why this report is such a big deal:

Friday’s Labor Department report is more eagerly anticipated than most. It is one of only three jobs reports remaining before the Nov. 6 presidential election. And it will come just hours after President Obama claims his party’s nomination at the Democratic National Convention, capping a meeting where Democrats have argued before the nation that the economy , while struggling, is on the right track.

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August jobs: ADP report says 200,000-plus added

Barack Obama Goes On 2-Day Campaign Swing In Ohio And Pennsylvania

Chip Somodevilla/Getty Images

President Barack Obama speaks at a campaign event in Ohio. The August jobs report from the Labor Department, due out tomorrow, could cap a big week for the President if it shows 200,000 new jobs added by the struggling economy.

How big a plus? 201,000, to be exact. The ADP employment report is put out by the private payroll processor and is something I usually work into my preview of the monthly jobs number that's generated by the Labor Department. 

This time around I'm going to give it its own post because tomorrow's government report is so important. Remember: Our unemployment rate is at 8.3 percent nationally. We haven't had a 200,000-job month since early this year. And the sitting President will be accepting the Democratic Party's nomination...tonight. Taking all this into account, you have an August jobs report that's a much bigger deal than usual. Especially given the pressure that the Federal Reserve is under to undertake another round fo "quantitative easing," injecting money into the U.S. economy to improve growth and lower unemployment.

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July jobs report: Another sluggish month?

A jobs sign hangs above the entrance to

KAREN BLEIER/AFP/Getty Images

A jobs sign hangs above the entrance to the US Chamber of Commerce building in Washington, DC. Will July's government jobs report signal a turnaround in the sluggish labor market?

The Labor Department will release its jobs report for July at 8:30 a.m. tomorrow. I'll be on dawn patrol in L.A. to report the news as it breaks, but that doesn't mean we can't take a stab at trying to figure out how the U.S. economy did job-wise last month.

For background, in the first quarter of the year, we added on average about 200,000 new jobs each month. In the second quarter, that dropped to less then 100,000. We need something on the order of 300-400,000 to get the roughly 13 million people who are currently unemployed in America back to work. The 200,000 we were getting per month in the first quarter enabled us to keep pace with new workers coming into the labor force. The 100,000 per month since means stagnation — or, as I've called it, "stuckflation," with the economy growing modestly and the unemployment rate remaining at around 8.2 percent.

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June jobs report could 'surprise to the upside'

A jobs sign hangs above the entrance to

KAREN BLEIER/AFP/Getty Images

A jobs sign hangs above the entrance to the US Chamber of Commerce building in Washington, DC. Friday's jobs report from the Labor Department could be a happy surprise.

"Surprise to the upside" — that's finance-speak for something in the market turning out better than expected. After last month's fairly dreadful jobs report, with the U.S. adding only 69,000 jobs in May, many observers are expecting another sluggish month in June. However, some data that has arrived before the official Labor Department report tomorrow suggests that June could beat expectations.

As I wrote this morning, the ADP report says that the country added 176,000 new private-sector jobs in June — with the lion's share coming from small-business hiring. The Challenger report on layoffs also indicated that companies planned to lay off less than 40,000 workers in June, a 13-month low. And first-time unemployment insurance claims for the last week in June fell, to 374,000. If you're below 400,000, that's typically a good sign for the economy's improving health.

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