August 7, 2009

National jobless numbers offer glimmer of hope

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If our current economic climate made any sense, this morning's announcement that the country's workforce lost 247,000 jobs in July would be greeted as terrible news. And it is terrible. But in light of the 443,000 job losses suffered in the previous month and the year's worth of increasing monthly declines, the latest numbers from the U.S. Department of Labor are at least a sign that the bleeding is slowing down.

For the first time since April 2008, the nation's unemployment rate declined slightly to 9.4 percent in July, compared to 9.5 percent in June. Many Wall Street analysts had predicted before today's numbers that July job losses would reach 320,000 and kick the overall unemployment rate to 9.6 percent. As a result, the markets responded favorably with 113-point rise in the Dow Jones.

The news follows yesterday's report that home sales in King County were up by 10 percent compared to the same time a year ago, representing the highest level in two years, while the supply of houses on the market fell by 20 percent, indicating a stronger demand.

But before we can break out the confetti over the job and real estate figures, we must realize that a true recovery can only come about when jobs start getting created rather than slashed. Once you include the number of unemployed workers who have given up looking for work, the true unemployment rate for July was 16.3 percent, representing 14.5 million people coast to coast. Other analysts have pointed out that the reason that layoffs have eased is simply because there are so few jobs left to trim from the thinly staffed companies that are still in business.

On the real estate side, despite the surge in sales, home prices have not yet responded to the increased demand. In July, the median price for a single-family home in King County was $384,000, which is 13.7 percent less than the July 2008 average of $445,000. Hardly a positive indicator for an industry that has had such a significant effect on the overall economy.

For now, we have to take these July figures as a sign that an economic turnaround does at least look imminent, if not actually in full swing. As Christina Romer, chair of the White House Council of Economic Advisers put it today, "This is the least bad day we've had in a while."

How will this employment news affect our own regional employment figures? Stayed tuned until the next employment situation report is released Aug. 18 by the state's Employment Security Department.

Randy Woods writes about job-search tools, networking techniques and other tips to help you land your dream job.

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1 Comments

Pete on August 8, 2009 7:23 AM | Reply

There is an interesting interactive unemployment level heat map for metro seattle and tacoma at http://www.localetrends.com/metro/seattle_tacoma_washington_home.php?MAP_TYPE=curr_ue

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