Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Weekly Review: The Employment Situation

I never know what the BLS jobs report (my analysis here) will say. It is the most random of all major governmental reports. It is very inaccurate in real time as:

  • the cutoff date for the report is in the middle of the reporting month;
  • the reporting month's data is extrapolated from only a portion of the eventual reporting sources;
  • the seasonally adjustment methodology tends to favor existing trends, and if the trends are changing - this report takes a few months to catch the change;
  • the report is segmented between a survey and real data. The survey portion usually does not match the data portion - and the survey portion tends to be noisy;
  • yah gotta read the "fine print". Headline Unemployment is a carefully crafted nuanced number - and has nothing to do with real unemployment which is employment slack.

Overall - employment grew in 2012 mostly between 1.7% and 1.8%. This roughly is the same rate as economic growth (and both numbers are far from excellent).

The Econintersect economic forecast for January 2012 shows weak growth. The underlying dynamics have a whiff of improvement - as underlying trends seemed to have stabilized with some marginally improving. Most of the recession markers have evaporated, and one of our alternate methods to validate our forecast remains recessionary (but now only slightly so). All in all, still not a great forecast - but at least there is hope that conditions will be improving in the months to come.

ECRI believes the recession began in July 2012. ECRI first stated in September 2011 a recession was coming . The size and depth is unknown. The ECRI WLI growth index value has been weakly in positive territory for over three months. The index is indicating the economy six month from today will be slightly better than it is today.

Current ECRI WLI Growth Index

Initial unemployment claims rose from 350,000 (reported last week) to 372,000 this week. Historically, claims exceeding 400,000 per week usually occur when employment gains are less than the workforce growth, resulting in an increasing unemployment rate (background here and here).

The real gauge - the 4 week moving average - continued to fall from 356,750 (reported last week) to 360,000. Because of the noise (week-to-week movements from abnormal events AND the backward revisions to previous weeks releases), the 4-week average remains the reliable gauge.

Weekly Initial Unemployment Claims - 4 Week Average - Seasonally Adjusted - 2010 (blue line), 2011 (red line), 2012 (green line)

Bankruptcies this Week: None

Data released this week which contained economically intuitive components (forward looking) were:

  • Rail movements (where the economic intuitive components indicate a moderately expanding economy).

All other data released this week either does not have enough historical correlation to the economy to be considered intuitive, or is simply a coincident indicator to the economy.

Weekly Economic Release Scorecard:
Gold Scenarios
Investing.com Weekly Wrap-Up 04 January 2012
What We Read Today 04 January 2013
ECRI's Weekly Leading Index Growth Index Slips Marginally w/e 28 December 2012
Manufacturing New Orders Not Pretty in November 2012
ISM Services Index Comes In Well Above Expectations in December 2012
BLS Jobs Report Ok in December 2012, Nothing Exciting
Infographic of the Day: Natural Cold Remedy Effectiveness
Selected Recent Articles About Gold
Fed's Balance Sheet 03 January 2013: Balance Sheet Down $8.9 billion
CoreLogic: Losses to Natural Disasters in 2012
The First 2013 Open Letter to President Obama
Final Review of 2012 Holiday Shopping Season
Straddles and Strangles in Depth
China: Hangzhou Tourism Film
Rail Week Ending December 29, 2012: Massive Decline to End the Year
December 2012 FOMC Meeting Minutes: Discussing Quantitative Easing
It's Not a "Fiscal Cliff" … It's the Descent Into Lawlessness
What We Read Today 03 January 2013
November 2012 Philly Fed Leading Index Is Projecting Positive Economic Growth
Nonfinancial Leverage NFCI Again Deteriorated Slightly w/e 28 December 2012
29 December 2012 Unemployment Claims Jump Marginally, Remain Slightly Elevated
December 2012 ADP Jobs Up 215,000, Best Since February 2012
Challenger December 2012 Job Cuts Near Lowest Monthly Level in 2012
Stratfor: 2013 Is A European Decision Year
Should the Economy "Serve" Money or Vice Versa?
China: Reawakening the Industrial Titan
Whiskey is for Drinking, Water is for Fighting
What Was Bill Black Saying in 2005?
China PMI Looking Up and Other Recent News
Fiscal Cliff Deal: Removed Support for Co-ops
Foreign Investment in Chinese Real Estate?
Savings Impede Growth
What We Read Today 02 January 2013
Sharp Declines for US Dollar Coming
The Two Faces of the Inflation Monster
Construction Spending for November 2012 Down, Still Strongly Expanding
December 2012 ISM Manufacturing Survey Back Into Expansion Territory
Average Gasoline Price Rise $0.041 in Week Ending 31 December 2012
Infographic of the Day: NASA's New Space Suit
Forward Markets: Macro Strategy Review
The Present Crisis, A Pattern
Too Much Money and No Money to be Made
India: Summary of Selected News
House Passes Fiscal Cliff Bill
Bankers Blow Bubbles
The Sources of Unemployment
Investors: Deal or No Deal?
What We Read Today 01 January 2013
Infographic of the Day: Another Look at Charitable Donations
Fiscal Cliff: Senate Acts
US Gun Policies: Facts You Should Know
Oil, Gasoline Markets End 2012 with Swollen Inventory Levels
Festivus Stocking Health
Book Review: Plutocrats by Chrysta Freeland
Latvia: Oligarchy as Robbers
No Cliff Rescue Tonight
Deprogramming Progressives Indoctrinated into Supporting Austerity
Insider Trading 28 December 2012: Intuit, FactSet Research, Accenture Big Sellers this Week
The Cliff Rescue
What We Read Today 31 December 2012
Texas Manufacturing Improved Marginally in December 2012, Slow Growth
Bloggers End 2012 on Bearish Note
Why is the 30 Year Mortgage Rate So High?
Infographic of the Day: Does a Post-Graduate Degree Pay Off?
Where Oil Prices Are Headed In the Face of the Fiscal Cliff
Troubled Times Ahead for Community Banks
France: Tripped Up By 1798 Declaration Of Human Rights
Michigan Supreme Court: JP Morgan Mortgages Worth Billions are Voidable
Australia: Weather Related Natural Disaster Costs are Exploding
Economic Forecast January 2013: Weak Expansion but Hints of Improvement
Stock Market Secular Trend Review
What We Read Today 30 December 2012
Infographic of the Day: Earth's Nearest Solar Neighbors
Sunday Economic Comedy: Comedy for Social Change
2013 Predictions: A Strengthening Economy
What We Read Today 29 December 2012
Medicare Scam
The Great Debate©: What Are the Proper Boundaries for Personal Privacy?
The IMF on Overinvestment
Student Loans Destroying Consumption
Stocks Beat Gold in 2012

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.