Blue World Jobs Report Analysis 02-08-2014

Blue World Employment Situation Report Analysis

Release Date:  Usually the first Friday of each month

Release Site:

Market Sensitivity: VERY HIGH

Management Value: VERY HIGH

Friday, February 07, 2014

Brain surgery is not rocket science to a brain surgeon©

As human beings, I believe the reason others are capable of disappointing us is because most of us assume that others will react as we would to a given situation.  When we learn that not everyone sees things the way we do it becomes difficult to be surprised or disappointed by others.  The same, of course, holds true for data.  Already we see the word “disappointing” all over the media regarding the jobs report.  They, inexplicably, also continue to use the word “recovery.”  We don’t consider this report “disappointing” when things are just as all the other indicators have suggested they would be.  After all, what’s changed that would lead anyone to believe that things would improve by any meaningful degree since December 2013?

The headlines posted 113K new jobs.  The meaningful news is actually a little better than that.  The 113K reflects “total non-farm” employment.  That includes government jobs.  We are more interested in the “total private” number which was actually 142K.  Government shed 29K jobs in January leaving us with a net of 113K new payroll tallies for January 2014.   In either case, please remain mindful that we require about 250K new jobs per month to break even on those becoming eligible to work.

The number of those unemployed came down a bit, and the employed number as well as the participation rate “improved” slightly.  The quotes are in aid of the fact that this is an all too familiar pattern of these stats making lower highs and lower lows.  For example, the participation rate rose by .2%.  This gets it up to 63%.  63% was an all-time record low reported in the November 2013 release.  The number stood at 63.6% in January of 2013.  This is a continuation of a downward stair-step pattern that goes back over five years. 

The work week remained flat, and overtime hours in the manufacturing sector actually retreated slightly. Both measures of the time the economy needs from workers each week remains range bound and offers no indication of escalating need for additional workers anytime soon.

Consider all this back-dropped against the recent CBO report that indicated the Affordable Care Act can be expected to further drag the economy and cost us about 2.5M more full time jobs over the next few years.   That report can be found in the Wall Street Journal article titled, “The Jobless Care Act.”

Disappointing?  Perhaps for the “experts” who were “surprised” by the weak data, but please forgive them.  They don’t know what you and I do.  We’ll only be “disappointed” if we fail to realize that nothing’s changed!

Thanks for reading and, please, stay tuned…

Release Site:

Every effort is made to ensure accuracy of data transcription but accuracy cannot be guaranteed.  The official release site should be cross referenced.  The analysis represents the opinion of Blue World Asset Managers, Ltd. who does not warrant or guarantee predictions based on its analysis.

©Blue World Asset Managers, LTD Friday, February 07, 2014