U.S. Job Growth Likely by December

Now that the US recovery is in full swing, many continue to asked "when will this newfound economic growth produce new jobs?"

This past week all eyes were on job numbers. And there were some encouraging signs.

First, Challenger, Gray & Christmas, Inc. announced on Wednesday that planned layoffs at U.S. firms fell for a third straight month in October to a 19-month low. Announced job cut rates are now at levels that are below average.

Then on Thursday Monster's employment index was reported to rise an additional point in October to 120 indicating an ongoing improvement in job demand. The Monster Employment Index is a comprehensive monthly analysis of U.S. online job demand.

And finally, initial jobless claims are clearly on the decline, down 20,000 in the Oct. 31 week to 512,000 (prior week revised 2,000 higher to 532,000). The four-week average is down for the ninth straight week, 3,000 lower at 523,750 for a 25,000 decrease from late September.

So just when will this strong recovery start producing new jobs?

The answer is likely found in the significant decline in the number of jobs lost since March. As can be seen from the linear trending in the chart below, if the current economic climate stays intact, it is quite likely that we will actually see job growth starting sometime in December.

Comments

[Old Trader:]

"Now that the US recovery is in full swing, many continue to asked "when will this newfound economic growth produce new jobs?""

In "full swing"???? You ARE kidding, right? Obviously, the author believes denial is a river in Egypt.

Nov 08 12:00 PM

[Jimbo:]

I don't know what "Good News" is smoking, but it's got to be real good stuff!

Nov 08 12:31 PM

[goober1:]

Apparently you are not aware of the millions that have already expended there UI claims and are not counted ? Actual unemployment is closer to 20% than 10%. I am still amazed at the people that call themselves economist. Unfortunately there is plenty of evidence in the current administration to validate the ineptitude of many so-called economist. We are headed in the wrong direction by wrong thinking ECONOMIST who refuse to deal in reality and insist on digging a deeper whole as fast as possible with bailouts and stimulus. I truly fear for all of our futures given this mania and a race to more spending/fisacl irresponibility. My education taught me something very different than yours and my life experience confirms my perceptions. You are simply wrong and do a great disservice by promoting such distortions and non factual dogma. Did you go to the schools as Cramer?

Nov 08 02:05 PM

[buoy:]

Do you realize December is next month?

Nov 08 03:34 PM

[Larrysyr:]

Recessions are all about restructuring. Some companies get weeded out, some survive to thrive later, some even get a foothold and take off during the downturn. Whatever, the causes, the mechanics involve companies slashing costs (including payroll) in order to survive. When the downturn ends, the surviving companies start growing again, start making new profits and then begin to hire. At first they hire temps. This is what we're seeing now.

Recessions always look bleak. In past recessions (especially the 70s and 80s), the picture looked even worse. Double digit unemployment, underemployment, double digit inflation, deficits, devalued dollar, the "misery index".

I think the overall premise - that the economy is improving - is correct. Actual job growth by December is a little too optimistic for me.

Nov 08 04:06 PM

[The Good Ne...:]

Thanks Larry,

Yes indeed I do tend to err on the side of being a bit too optimistic, rather than the pessimism that I see everywhere else... it is one of the basic principals of the blog.

It has again fascinated me to see the psychology of this recession as compared to that of the early phases of recovery cycles in 70s and 80s... and I would agree that several times the picture back then seemed worse. It is amazing to me that today those times and similar experiences are long forgotten by most and replaced with an almost egotistically assertion that this time the cycle is somehow much different and much worse.

Nov 08 07:05 PM

[ryanclarke:]

It is much worse because of the depletion of natural resources and the products derived from natural resources the U.S. economy requires to operate, gasoline being the primary dwindling product. If there is job growth in Q1 10 it will be because banks didn't write off bad loans in Q4 09 ... and more than likely the job growth will come from the health care industry and education industry ... as usual.


On Nov 08 07:05 PM The Good News Economist wrote:

>
> Thanks Larry,
>
> Yes indeed I do tend to err on the side of being a bit too optimistic,
> rather than the pessimism that I see everywhere else... it is one
> of the basic principals of the blog.
>
> It has again fascinated me to see the psychology of this recession
> as compared to that of the early phases of recovery cycles in 70s
> and 80s... and I would agree that several times the picture back
> then seemed worse. It is amazing to me that today those times and
> similar experiences are long forgotten by most and replaced with
> an almost egotistically assertion that this time the cycle is somehow
> much different and much worse.

Nov 08 09:47 PM

[Tom E.:]

Businesses need to start growing revenue. How do you grow revenue - sales and marketing, a niche that got kicked to the back of the bus this decade (when you are chasing the China price who needs s&m).

Nov 08 10:19 PM