Here’s Goldman-Sachs’s Jan Hatzius’s remarks on the most recent BLS employment situation report:
We do think the warm weather has been an important driver of stronger payroll numbers over the past few months. As we have shown, all of the acceleration in nonfarm payrolls since the fall has occurred in the (normally) cold states, and our state-by-state panel analysis suggests that weather has boosted February’s level of payrolls by 100k or a bit more. This state-level model suggests that none of the inevitable payback for this boost should have occurred yet, since March was just as warm relative to the seasonal norm as February. That said, weather-sensitive sectors such as mining and building construction did show some weakness, so we would pencil in 10k-20k for weather “payback†in March.
In addition, the 37,000 drop in retail employment was partly related to one-off job reductions in the department store industry, and should probably not be included in an estimate of the underlying employment trend. Taken together, we believe that the underlying trend in payroll employment growth is around 175,000 as of the March report. At this point, we would expect the headline number for April to fall short of this figure, partly because the weather payback is likely to be substantially larger in April than in March and partly because the underlying trend may be decelerating slightly (as suggested, e.g., by the drop in temporary help services employment in March).
The emphasis is mine. Or, said another way, quite a number of the jobs created in December, January, and February were time-shifted from later in 2012 and there is no improving jobs picture.
So, let’s recap. There is no improving jobs picture. Home prices continue to fall. There’s an enormous overhang of “shadow inventory” in housing that should suppress housing prices for quite a while. Retail is down. The price of gas is rising which should put some damper on economic growth.
What recovery was it that you were talking about?>
It was beginning to look like housing has finally bottomed out in my area of Florida. Over the last few months, according to Zillow’s statistics, there were even a couple of slight increases. But the last couple of months prices headed down again.
I also talked to my brother in Denver recently. He is very busy and he’s got a lot of work (he owns a construction business that specializes in office remodeling and fitting-out). Part of that is because things appear to be turning around in Denver. The other part is that many of his competitors are out of business.
This is a bit off-topic, but Ive been thinking about mismatches between jobs and the people who might hold those jobs. I don’t just mean that education A does not match job B, but rather that there exists no real-world ability to hire anyone for some jobs.
I would actually love to hire someone. But the someone I would need to hire would basically be me. I could probably keep two other MR’s busy and gainfully employed. But there’s no way to do that.
I doubt that problem is a big part of unemployment, but it’s probably bigger than it once was as more and more people do jobs that are highly specialized and are built around unique skills and talents.
I’ve had this problem for the last twenty years. Prospective candidates want to earn more than I do but they don’t know what I know, they don’t bring in new business, I have to train/manage them and do quite a bit of bookkeeping on top of it which means that I do less of what I want to do. That’s why I decided to close my doors and go back off on my own.
That’s the same basic problem my brother has. He would like a “foreman” to run the actual jobs while he concentrates on the business end and bidding. But he has yet to find anyone with the management and customer service skillset and he basically gave up after some big failures.
Krugman has a pretty good chart.
Gentlemen, we’ve discovered a market for clones.
What recovery was it that you were talking about?
THAT’S WHAT I”VE BEEN SAYING.
Gentlemen, we’ve discovered a market for clones.
What happens when the clone decides he’s tired of taking orders from an older, slower self? And that is just the tip of the iceberg – what happens when the missus decides she likes the younger fitter self? I’m thinking this can’t end well.
There’s a problem with clones: I’m not sure I’d like “me” very much at all.