Today's unemployment report was a big disappointment - and I'm not quite sure why to be honest, because I don't see any noticeable private sector hiring.
Nevertheless, the market was spooked as stocks moved sharply down early in the trading day, though they managed to pare back much of their losses later in the session.
Officially, the unemployment rate held steady at 9.5%. Unofficially, the number is much higher - perhaps approaching as high as 20% when backing out the BS adjustments.
We are probably in for a rather prolonged period of high unemployment. It's going to be a tough time for the American middle class. US manufacturing jobs have been gone for awhile, and many of the stop gap replacements - such as the construction and service sectors - are currently toast with the bursting of the credit bubble.
While I'm sure middle class jobs will come back eventually, it looks like we're in for a long, tough period until that day comes. In the meantime, expect more and more shovel-ready government projects to keep employment at reasonable levels.
Disclosure: Short the S&P 500 via Futures and SDS