Finally, Some Good News in the 'Hours Worked' Statistic

In the July employment report released by the BLS this morning, the labor market shows its first encouraging signs. Most commentators will focus on the jobs numbers, which show a decline of only half the rate that the economy experienced in the “freefall period” of late 2008 and early 2009.

Employment tends to lag behind production. For this reason, as readers of this blog will know, my preferred indicator is total hours worked. The latest numbers show that the length of the workweek has begun to rebound from its record low of two months ago. As a result, the BLS reports that total hours worked in the economy did not decline at all in July, for the first time since the financial meltdown of last September.

One never wants to read too much into a single monthly report, which is subject to revision. But when today’s labor news is combined with a variety of other data, it looks likely that the economy is finally at or near the turning point.

Hours Worked from the Current Employment Statistics survey,
Bureau of Labor Statistics, Aug. 7, 2009

Comments

[Mad Hedge Fund Trader]

You have to look hard for the real good news. Looks like I am going to have to be the designated driver on this one. The Friday nonfarm payroll showing losses of only 247,000, with upward revisions to May and June, is signaling to many that the bull market is back. You might as well put a giant neon sign on your roof saying “party here tonight.” One can never underestimate the animal spirits here. I’m sure the newspapers are going to call the 0.1 % micro improvement in the unemployment rate to 9.4% as the beginning a major trend. But I don’t see any consumer spending on the horizon, and I was able to breeze through my favorite restaurant at lunch because it was still half empty. I think what is really happening here is that having priced in Armageddon in March, we are now pricing it back out. What’s an Armageddon worth? Some 3,000 Dow points, or 350 S&P 500 points, where we are right now, sounds like the right price to me.Let me know when you’re ready to go home, and I’ll pile your inebriated carcasses back into the car. I’ll even take the breathalyzer test.

2009 Aug 07 04:19 PM

[Tony Petroski]

The Madman plus Cetin weigh in.

The author: "One never wants to read too much into a single monthly report, which is subject to revision. But..."

I hope for the best. Mr. Frankel, good day to you.

2009 Aug 07 07:24 PM

[TCK]

Perhaps you could come up with something different as opposed to the same silly comments on every story on Seeking Alpha ?


On Aug 07 04:19 PM Mad Hedge Fund Trader wrote:

> You have to look hard for the real good news. Looks like I am going
> to have to be the designated driver on this one. The Friday nonfarm
> payroll showing losses of only 247,000, with upward revisions to
> May and June, is signaling to many that the bull market is back.
> You might as well put a giant neon sign on your roof saying “party
> here tonight.” One can never underestimate the animal spirits here.
> I’m sure the newspapers are going to call the 0.1 % micro improvement
> in the unemployment rate to 9.4% as the beginning a major trend.
> But I don’t see any consumer spending on the horizon, and I was able
> to breeze through my favorite restaurant at lunch because it was
> still half empty. I think what is really happening here is that having
> priced in Armageddon in March, we are now pricing it back out. What’s
> an Armageddon worth? Some 3,000 Dow points, or 350 S&P 500 points,
> where we are right now, sounds like the right price to me.Let me
> know when you’re ready to go home, and I’ll pile your inebriated
> carcasses back into the car. I’ll even take the breathalyzer test.

2009 Aug 10 06:46 AM

[Philip, Tatum LLC]

I skeptically agree with the notion that the economy may be finally turning it around. Our firm's survey of business conditions (cli.gs/4hUYE8) supports this notion, but it may be too early to tell if the economy is truly in recovery or if this is only temporary. Q3+4 numbers and what happens in the new year will be the only way to know.

2009 Aug 11 03:37 PM