October private-sector job losses narrow, but still hit 203,000
Filed under: Economy
Just call it a month in which the private-sector job market treaded water: It lost 203,000 jobs in October, following a revised 227,000 reduction in September, according to data compiled in the ADP National Employment Report. September's original loss estimate was 254,000. Economists surveyed by Bloomberg News had expected private employers to cut 200,000 jobs in October. Separately, job-placement firm Challenger, Gray & Christmas said job cut announcements by U.S. employers fell to 55,679 in October, 16 percent lower than in September, CNMoney.com reported Wednesday.
ADP noted that the 203,000 private payroll cutback was the seventh straight monthly decline. Nevertheless, ADP added, "despite recent indications that overall economic activity is stabilizing, employment, which usually trails overall economic activity, is likely to decline for at least a few more months."
The job loss totals in October by business size were: 53,000 (large), 75,000 (medium), and 75,000 (small).
Further, the services sector -- formerly a U.S. strength during the recent economic expansion -- lost 65,000 jobs in October. The goods-producing sector slashed 117,000 jobs and manufacturing shed 65,000 positions. The construction sector eliminated 51,000 jobs, its 33rd consecutive monthly decline, and brought total construction jobs lost since the January 2007 peak to 1.7 million.
Investors should monitor monthly job reports because job creation is positively correlated with corporate revenue and earning gains. And as corporate earnings go, so goes the U.S. stock market.
Job creation also is the key to consumption, which contributes greatly to U.S. GDP. However, given a decade of overconsumption and stagnant incomes in many job classifications, few economists expect spending patterns to return to the home equity/refinance-distorted, cash-flush years of the housing bubble. Nevertheless, many economists do expect both consumer spending and business investment to trend slightly higher in the quarters ahead.
Economic Analysis: Basically, the ADP October report on private-sector employment came in about as expected. Still, the optimist would see the continuing downtrend in job layoffs, which ADP noted. One of the ironies of the U.S. economy is that as it becomes more productive per employee, it takes fewer and fewer employees to perform the same tasks. This has the effect of reducing job gains and lengthening the recovery time to full employment. And that makes the task of policymakers and executives more difficult.
Even so, they must remain focused on job creation: The U.S. economy needs to create 150,000 to 200,000 jobs every month to lower unemployment. Also, investors should keep in mind that the more-telling job statistic, containing both private- and public-sector job data, is the U.S. Labor Department's monthly nonfarm payroll report, and the October data will be released Friday, Nov. 6 at 8:30 a.m. EST. It's expected to show a 175,000-job decline in October after a 263,000 loss in September, according to a Bloomberg News survey of economists.
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Reader Comments (Page 1 of 4)
11-04-2009 @ 10:30AM
Unemployed said...
WHEN is the GOVERNMENT going to get it and help the UNEMPLOYED people out here save their homes from FORECLOSURE????????? If the Government does not help the Unemployed stay in their homes they will pay a BIG price come election time!!! They Bail out the big guys NOW ITS TIME to help the little guys!
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11-04-2009 @ 6:18PM
john said...
At the same time Osama Bin Biden is claiming a victory because 650,000 worthless government jobs were manufactured with taxpayer money, the real and only economy is still steadily losing more than 200,000 real jobs AND while the artificial taxpayer funded part of the GDP is growing for the first time since Obungle took office, the private sector of the economy is still shrinking drastically and going straight down the toilet. WAKE UP AMERICA!!!!!!!
11-05-2009 @ 1:36AM
USAunite said...
The U.S. government will not bail out the unemployed from foreclosure. There is a way though for those out of work to unite as well as others too. It's called the Peoples Financial Stimulus Plan at www . peoplesstimulusplan . weebly . com - to find out about it and what to do. It's simple and it's for people !
11-04-2009 @ 10:48AM
T Singer said...
Reality has not hit yet for most Americans,and when it does ,NOT GOOD ,will be understating the problem! How many people are upside down on their homes since purchasing from 2004 to present?Calculating the true economic devistation of this unpresidented negative leverge scenario seems to be a computation NO ONE will talk about!Most of us have borrowed money to buy our homes,which are losing value daily,all the while we as good americans pay our bills.We LOOSE...........100% of the interest to the Greedy banks,we pay taxes and insurance all to hold onto the "American Dream"......................Joke! It is now the American Nitemare! Why is the Government continuing to bail ou these institutions,and allowing the most sacret of institutions,The American Household,to FAIL??????????????????
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11-04-2009 @ 12:55PM
kevinkeb4 said...
The only reason job losses are slowing is that most places are already down to skeleton crews.It is only logical that after the millions of jobs that have been lost already,job losses would slow.What kind of sunshine are these people trying to blow up our a #@*'s.
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11-04-2009 @ 1:14PM
Eddie Hilton said...
this must be obama math - the figures in the fifth paragraph add up to 298,000. it starts by saying further - that sounds like those were on top of the 203,000.
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11-04-2009 @ 6:48PM
Old Swaby said...
I have to agree...I added it up and the figure I come up with is 501,000 jobs lost...I also agree their running out of people to lay off...Maybe there should be more Government employees (city, county, state, and federal) layed off...Why does the private sector have to bite the bullet while civil servents get their perks and COLAs...The suffering should be shared by all, not the few...
11-04-2009 @ 1:38PM
Jenny Baldwin said...
Why are people depending on the government for anything like jobs and homes. You need to cry out to God Almighty. He will supply all your needs. Do you really think the gov. cares about you. Do not rely on mans ways but instead on Gods ways. He will open the windows of heaven and pour you out a blessing.
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11-04-2009 @ 1:43PM
BARRY said...
when is the goverement going to step up and help the people who uneployed there are people loseing there jobs and cant pay there bills but yet they say the job market is getting better where? barry
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11-04-2009 @ 6:23PM
Karen said...
They are helping us by extending our measly unemployment benefits. Benefits which are taxed and far from being enough to pay bills, eat and have a roof over our heads.
11-04-2009 @ 2:02PM
John said...
203,000 jobs lost? How can that be? I thought the grand policies of O were saving and creating jobs. Must be a lie!! It was invented by those nasty right wingers. Oh, wait, it said private jobs, not government jobs. Okay. never mind.
12 months
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11-04-2009 @ 2:15PM
Dennis said...
Only 200,000 jobs lost a week and everyone is cheering because they still have a position. Why don't they tell us the total number every week. Because people whould 'flip'. The real number is convoluted with data to show a better picture than actually is occuring. Reagon administration took into account active duty G.I.'s to count jobs making employment look better than it was. We never count people who dropped off the other end or those taking part time work as unemployed. We don't talk about the 'underemployed'.
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11-04-2009 @ 2:27PM
duckinnut said...
300,000 job losses in two months and they claim the recession is over.Sure its not the 1.5 million it was a couple months ago,but there is no one left to lose there jobs.
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11-04-2009 @ 2:29PM
timothy said...
We do talk about the totals. The total unemployed is just over 15 million...or about 10% nation-wide. The other 'total' is people who are working part-time or at temporary jobs until they can find a position in their own field. Economists estimate this figure is another 7 % of the work force (or about .07 X 160 million 'earners' = 11 million) How you like that 'change' since Nov. 08 ?????
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11-04-2009 @ 2:39PM
timothy said...
Dont hold your breath waitng for the 'gubmint' to hand out cash for the unemployed to pay their home mortgages. The gubmint doesnt think you are smart enuff to handle your money. Too many people would simply apply for the money and walk away from a house that's 'underwater' on the mortgage. Another 3 months of job losses ????? u can double that
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11-04-2009 @ 2:46PM
timothy said...
What's going on in auto-land???? Early this week? Chrysler announced plans to offer buy-outs to 23K employees. Thats over half their UAW workforce. Today KIA of S. Korea announces they will be hiring about 2000 for a second shift at their new plant in Georgia early next year. Glad to see how US producers are hanging right in there ....NOT!!!!! The combination of chrysler and FIAT ...produces a Fartler
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11-04-2009 @ 2:59PM
Annie said...
How many votes were saved in yesterday's election??
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11-04-2009 @ 3:15PM
AL said...
As another blogger on here stated, government jobs are not taking a hit and why not? Most government jobs if you can call them that are do nothing jobs and just fill a seat with a body. Frm local government to state and federal, it's a crying shame to see do nothing jobs being created. The private sector gets the hell beat out of it, but do nothing government jobs are doing quite well. Just more deadbeats.
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11-04-2009 @ 3:22PM
sam said...
when is the goverement going to help the people that are on unemployment ore unemployment has ran out they are loseing there homes cant pay there bills and nothing is being done thats terrible i would say?
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11-05-2009 @ 1:12AM
Ben said...
Hussein math. In excess of two hundred jobs lost means Joe Biden actually SAVED five hundred thousand jobs!
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