plus 1, 2011 Jobs Outlook: Better, But Not As Good As It Was - NPR News

2011 Jobs Outlook: Better, But Not As Good As It Was - NPR News

Posted: 28 Dec 2010 09:26 PM PST

The Employment Landscape In 2010: Growth & Decline

Employment in 2010 had some substantial ups and downs, including a loss of more than 200,000 government jobs. Meanwhile, jobs in the private sector grew substantially, though not enough to bring down the unemployment rate.

In January 2010, the unemployment rate was 9.7 percent. If you had asked most people then to look forward to the end of the year, few would have guessed the rate would be even higher now.

But it is. Today, the number of people out of work is a little more than 15 million.

Yet the economy did start creating jobs again this year. Many economists believe next year the unemployment rate will drop to around 9 percent, or about double what it was before the recession began.

'Standing Still Isn't All That Great'

Each month, the labor department releases new data about the nation's employment situation. That includes the unemployment rate and whether the number of jobs on payrolls went up or down.

On average, the private sector created 100,000 jobs a month this year. But as President Obama said, almost every month: It wasn't nearly good enough.

"As I've said before, the only piece of economic news that people still looking for work want to hear is, 'You're hired,' " Obama said.

Cliff Zukin, a professor of public policy at the Heldrich Center for Workforce Development at Rutgers University, describes the labor market in 2010 as "dismal, and pathetic and dire."

"The job creation compared to the amount of people out of work, is a drop in the bucket," he says.

There were about 1 million jobs created — but the unemployment rate rose to 9.8 percent. In addition to the unemployed, an additional 9 million are working part time but want full-time jobs.

Mark Zandi, chief economist at Moody's Analytics, says in 2010 the labor market was running hard, but going nowhere. The economy needs to generate about 150,000 jobs a month, Zandi says, just to keep up with population growth and people re-entering the workforce. It didn't do that in 2010.

"It wasn't negative. We weren't hemorrhaging jobs," he says. "But in the context of 10 percent unemployment, standing still isn't all that great."

Just ask Jack Warner, who lost his job in the auto industry two years ago. He's going back to school to get new skills, and still checking job search websites every day hoping for leads. He describes this past year in which he had just one job interview as frustrating.

Warner is an IT professional who specializes in mainframe computers. There just aren't that many jobs left in his field. His one job interview was the week before Thanksgiving. He hasn't heard anything from the company since.

"I thought it went well," he says. "But I guess not."

Warner is about to join the 99-ers — a term for people who have received 99 weeks of unemployment benefits and aren't eligible for any more. Warner's benefits run out around the first of the year and he's not sure what he'll do.

'Here We Go Again'

Many of the jobs created in 2010 were temporary positions, some 260,000 of them. In May, Trenda Kennedy landed a job in the mental health field after months of unemployment. Health care was another major growth area in the labor market this year. Two months later she was laid off.

"So I was very crushed, but fortunately another person on our team decided to take another job and so they called me back," she explains.

Kennedy says the job has been great, but it's going to be a long time before she forgets what it felt like to be unemployed.

"When my boss called me back into his office the other day, I just thought, 'Oh no, here we go again. I'm going to get laid off again, something has happened.' No, it was a project. But still your mind goes down that path," she says.

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U.S. Economy: Confidence Falls on Concern Over Jobs - BusinessWeek

Posted: 28 Dec 2010 09:05 PM PST

December 29, 2010, 6:52 AM EST

By Timothy R. Homan and Bob Willis

(Updates with closing market prices in fifth paragraph.)

Dec. 28 (Bloomberg) -- Confidence among U.S. consumers unexpectedly fell in December, restrained by concern that jobs will remain scarce in 2011.

The Conference Board's confidence index unexpectedly fell to 52.5, lower than the most pessimistic forecast of economists surveyed by Bloomberg News, figures from the New York-based research group showed today. Another report showed home values dropped more than economists projected.

The loss of confidence is at odds with a report from the University of Michigan that showed sentiment improved to a six- month high in December, and with data showing holiday spending posted the biggest gain in five years. Federal Reserve policy makers this month said "depressed" housing and high unemployment remained constraints on consumer spending, supporting their plans to expand record monetary stimulus.

"We should watch what consumers do and not what they say," said Omair Sharif, an economist at RBS Securities Inc. in Stamford, Connecticut. "If you looked at the confidence data you wouldn't have looked for the pace of spending to accelerate as much as it has. Consumers are still very cautious and very nervous about where the labor market is headed."

Stocks rose, led by rising shares of commodity producers as energy and metal prices climbed. The Standard & Poor's 500 Index increased 0.1 percent to 1,258.51 at the 4 p.m. close in New York. Treasury securities fell, pushing the yield in the benchmark 10-year note up to 3.49 percent from 3.33 percent late yesterday.

Rising Sales

Retailers' 2010 holiday sales jumped 5.5 percent for the best performance since 2005, said MasterCard Advisors' SpendingPulse, which measures retail sales by all payment forms. That compared with a 4.1 percent gain a year earlier. The numbers include Internet sales and exclude automobile purchases.

The median forecast for confidence, based on a survey of 61 economists, projected confidence would increase to 56.3. The Conference Board revised the November figure to 54.3 from a previous estimate of 54.1. Projections ranged from 53 to 60. The index averaged 96.8 during the last economic expansion that ended in December 2007.

Today's report stands in contrast to preliminary figures from Thomson Reuters/University of Michigan which showed sentiment climbed this month as the share of Americans citing an improvement in current conditions climbed to the highest level since January 2008.

Drop 'Surprising'

"The fact confidence moved lower is a bit surprising given the other data we have observed for the month," said Dean Maki, chief U.S. economist at Barclays Capital Inc. in New York. "Month-to-month changes in confidence are not well correlated with those in spending. Reports from retailers as well as data on spending have been upbeat. We would give those more weight."

The S&P/Case-Shiller index of property values fell 0.8 percent in October from the same month in 2009, the biggest year-over-year decline since December of last year, the group said today. The decrease exceeded the 0.2 percent drop projected by the median forecast of economists surveyed.

"Despite the fact that housing will remain at pretty low levels through next year, economic growth in general will be fairly robust," Maki said on Bloomberg Television's "Market Pulse" with Pimm Fox. Maki said he expected growth in a range of 3 percent to 3.5 percent next year.

Home Values

The home-price gauge fell 1 percent in October from the prior month after adjusting for seasonal variations, matching September's drop which was larger than previously estimated.

Eighteen of 20 cities showed a decrease in prices in October, led by a 2.1 percent drop in Atlanta, and decreases of 1.8 percent each in Chicago and Minneapolis. Denver and Washington were the only two that posted gains.

Six markets, including Atlanta, Charlotte, Miami, Seattle, Tampa and Portland, Oregon, reached their lowest levels in October since prices started to retreat in 2006.

"The double-dip is almost here," said David Blitzer, chairman of the index committee at S&P. Sales aren't "giving any sense of optimism."

According to the Conference Board, the share of consumers who said jobs are hard to get increased to the highest level since February.

Those expecting more jobs to become available in the next six months reached the lowest level since July, while the proportion who expected their incomes to rise over the next six months also fell.

Jobs Gains

Employers added 951,000 workers to payrolls in the first 11 months of the year, according to figures from the Labor Department. December data are due Jan. 7.

The gains haven't been large enough to reduce unemployment, which was at 9.8 percent last month after finishing 2009 at 10 percent.

President Barack Obama on Dec. 17 signed into law an $858 billion bill that extends for two years Bush-era tax cuts for all income levels, continues expanded jobless insurance benefits to the long-term unemployed for 13 months and reduces payroll taxes during 2011.

Some Americans are more willing to make big-ticket purchases. Car sales in November rose to a 12.26 million unit pace, the highest since the government's cash-for-clunkers program in August 2009, industry data showed this month. Demand over the past three months is the strongest in two years.

"We have a high degree of confidence that 2011 is going to be a stronger sales year," George Pipas, Ford Motor Co.'s sales analyst, said in a Dec. 20 briefing with reporters in Dearborn, Michigan, where the company is based. "We're a whole lot better off than we were a year ago."

--With assistance from Pimm Fox in New With assistance from Pimm Fox in New York. Editors: Carlos Torres, Christine Spolar

To contact the reporters on this story: Timothy R. Homan in Washington at thoman1@bloomberg.net; Bob Willis in Washington at bwillis@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz cwellisz@bloomberg.net