Sunday, May 10, 2009

Economists React: Jobs Report Is ‘Less Bad’

The Wall Street Journal - Economists and others weigh in on the smaller-than-expected decline in U.S. payrolls and the increase in the unemployment rate. # We remain cautious on the employment front, as job losses typically continue for 3-6 months after the trough of economic output. That suggests a peak in joblessness towards the end of the fourth quarter 2009, a peak which would cap off two full years of consistent monthly payroll declines… There’s some hope at the end of the rainbow, but the economy will keep busy hunting down the leprechaun for a few more months before we get there. –Guy LeBas, Janney Montgomery Scott

# Many are interpreting the April employment report as yet another sign that the economy is “stabilizing,” but the more accurate interpretation of these signs is that the economy’s pace of contraction is slowing, which is not quite the same as stability and s still a long way from the economy actually improving. –Richard F. Moody, Forward Capital
# This is less bad than the 690,000 average in February and March, and both manufacturing and service losses slowed, but it is hardly a triumph or even a stabilization. It is terrible, as is the rise in the unemployment rate to 8.9% from 8.5%. Soaring unemployment is depressing wage gains… There’s much further to go here; seriously bad news because without wage gains people can’t deleverage unless they cut spending deeply. –Ian Shepherdson, High Frequency Economics

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