Weekly jobless claims were down 21,000 for last week but still far too high to indicate growth and the number is wrong anyway. Any week with a Monday holiday shows a drop like this. The number to look at is continuing claims which is up a full quarter million and this doesn’t allow for people falling off the back end of the compilation. The Bureau of Labor Statistics reduces the number of unemployed workers because they no longer count them as human beings simply because they have gone past 99 weeks without finding a job. They are forgotten ghosts and they should “keep going, there are no jobs for you here“.
Even if you have a job, things are probably not that good with the average worker only working 34 hours per week, your wages are falling and likely you are being “encouraged” to do work off the clock as well. The job growth touted last month was weighted heavily with service workers and more than half of those were temps.
Indeed factory output indicators are showing a serious slow down taking hold and capacity was only at 74% as it was, the up-tick in business over the past year was almost entirely the rebuilding of inventory depleted early in the crash. Cash flush companies have sought to reduce their cash holdings as having too much money can make you the target of a takeover bid by the bigger fish in the pond. But inventory expansion cannot continue and the market for goods will start contracting rapidly triggering more layoffs. What with millions of people suddenly running out of unemployment benefits and the certainty of massive state and local government layoffs then retail sales will certainly start to suffer eliminating retail jobs as well.
Signs are that retail sales are already starting to plummet even if the month was only down a half percent. While some big retailers showed gains last month this was mostly due to them eating their smaller competitors alive. If credit should tighten as it did in 2008 you will have a sudden spate of retailer bankruptcies.