2008 Job losses

463,000 jobs have been lost in 2008.

However, there could be a lag in the recovery of the labor market, as there was following the end of the 2001 recession.

"Job losses tend to be persistent, and the economy does turn before the job market," Karl added.

And Crary concedes that the credit crunch remains a big wild-card for any economic and job market predictions.

Although I couldn't help but notice the optimistic economist is predicting job gains for 2009 and 2010. Automotive?!? Sorry, but downsizing vehicles are here for a few years. With China and India coming online and the horrid mis-management of the Mexican oil fields (production down 37%), I see no return to the SUV craze nor the *need* for surplus vehicles as we saw during the bubble.

Jobs lag the economy. The economy is turning down. We're over-invested in too many sectors for a quick recovery.

Got Popcorn?
Neil

More Workers Cut to Part-Time Hours

This WSJ journal article gave me a little scare.

Why? I recommend reading the book the hungry years. In it, during the start of the Great depression, companies wouldn't lay off people. Now don't think I'm mean... but layoffs cut the surplus in one industry and allows for cheap fast growth in another industry that isn't over-invested. What we're seeing is companies are holding onto people long past its obvious that a staff reduction would be better. This is good if the economy turns quickly. Its really bad if a large number of companies 'wake up' at the same time and go from underworking people to laying them off.

What makes me blog this from the article?

n another sign of a weakening job market, employers are cutting hours for more workers to below the 35-hour-per-week threshold for full-time work because of slowing demand, or "slack work," according to government data.

Hyundai Motor Manufacturing Alabama LLC, a unit of Hyundai Motor Co., idled 3,300 production workers for 10 Fridays over the past three months, effectively dropping their weekly hours to 32 during the affected weeks. Pella Corp., a window and door manufacturer in Iowa, has trimmed hours for several hundred of its 10,000 employees over the past few months, many to part-time hours.

The moves indicate how cautious employers have become as they grapple with the slowing economy. Reducing hours is enabling many companies hurt by slowdowns in housing and autos, in particular, to stave off layoffs and retain skilled workers, but the cuts are squeezing earnings for many workers and putting some workers' benefits at risk.

Now, I understand not wanting to lose skilled workers. But this article notes that part time work (under 35 hours per week) is an accelerating trend.

Combine this with my previous article with decreasing tourism to Mexico...

The increasing unemployment...

Yep... we're in recession.

And look at those house inventory numbers...

And somehow this market is supposed to turn around quickly? lol That won't happen. We'll continue progressing through the investment emotions. However, I think we're towards the end of 'quick stepping' through the emotions.

scary edit:
Horses being abandoned

Basically, the used horse market has become... very picky. Owners who can no longer afford their horses are abandoning them to charities. Or worse:

Some owners aren't bothering to look for new homes. Laurie Waggoner, executive director of the South Florida Society for the Prevention of Cruelty to Animals, says the group recently rescued five horses that had been abandoned on the eastern edge of the Everglades swamps. The state of Georgia last February seized 99 starving horses from a farm and sentenced the owner, who pleaded guilty to animal cruelty, to five years in prison.

The numbers suggest further evidence of economic hardship. Just one more set of indicators. Hold on. We're in for a wild ride.

Got popcorn?
Neil

U-haul index #3

This is my third U-haul index. We continue to see a trend indicating job flow out of California continues.

The last one:
The first one:

I look at the cost of a 26' truck picked up on a Saturday (12/22/2007).

Redondo Beach to Las Vegas: $397 Return: $186

90277 to Phoenix, Az: $692 Return: $179

90277 to Dallas Texas: $1440 Return: $436

90277 to Austin Texas: $1236 Return: $407 (Cost to Austin is WAY down)

90277 to Spokane, WA: $2996 Return:$498

Basically, the conclusions are the same.
1) We have job flow out of California. Texas seems to have job growth.
2) The u-haul dealers in Austin have their act together (finally). The cost to Austin is so much less than it was 8/15/2007.
3) I still cannot figure out the premium for Spokane. Anyone know what's up?
4) Don't forget, this isn't about population growth. Day laborers, students, and others whom have little to no possessions don't rent a u-haul, they pack up the car.

Heck, I bet more than a few SUV owners are taking everything with that 'toy trailer' and otherwise abandoning the furniture.

Anyone else waiting for United Van lines moving survey?

Here is the 2006 survey.

Will Washington DC still be high inbound? I expect its long record to be broken.
I was surprised to see California "low outbound" last year. Will it remain that way, or go back to being 'high outbound.' Oh well... last survey was 1/8/2007. It will probably be released on the 7th or 8th of 2008. So again, patience.

Got popcorn?
Neil

Mortgage Woes to Sink Property Values

WASHINGTON (AP) -- An expected surge in home foreclosures will cause U.S. property values to sink by $223 billion, with the most severe impact in minority communities, a new report says.

From:
Article on Yahoo Finance

This will just start to give J6P some perception there is a problem. However, this "survey" is such fluff it totally misses the problem. But hey, its getting the news out.

We're one downgrade away from Countrywide going under. E-trade is in trouble and need I describe the debacle of the "super-fund" SIV bailout? Prices will go gown a bit in 2008 and a lot in 2009.

I am beginning to wonder if the slow sales rate (seasonal and mortgage driven) is artificially hiding price declines. Oh well. Its not like I didn't know to wait until 2010 anyway.

And California is hurting. "As California goes, so goes the nation." Its just going to be a matter of degree. Even some of the normally "anti-Aerospace/defense" publications are starting to wake up to the job bleed.

I wish I had more information today on aerospace job transfers. I'm unusually in the dark.

Got popcorn?
Neil

Temp labor demand down: WSJ

" Add another item to the economic worry list: Employers are shedding temporary workers.

Temporary employment, long a buffer that gives companies flexibility, has fallen each of the past six months, and in July was down nearly 2% from the start of the year, according to the Bureau of Labor Statistics. U.S. revenue at Manpower Inc., the world's second-largest staffing firm after Adecco Group, dropped almost 9% in the second quarter, as demand fell. "

http://online.wsj.com/article/SB118817263054609344.html?mod=hps_us_whats_news

In case it doesn't fit on one line, I've split it into three:
http://online.wsj.com/article/
SB118817263054609344.html?mod=
hps_us_whats_news


but the most interesting bit:
" The Background: Use of temps is often viewed as a leading indicator for the overall job market, as companies cut temps before full-time workers on their payrolls.


If you have an online subscription to the WSJ its worth a read. It goes into how this is a slow drop in temp demand and is not a severe drop as happened in the last recessions.

But don't miss two of the last three paragraphs. I'll only paste one to keep within "fair use" guidelines:

Because the temp and overall job markets haven't tracked closely in recent months, the weakness in temp hiring could be a false indicator. "Nobody has ever seen this type of a pause in temp employment growth," Mr. Camden said. "This is just an unusual array of numbers...In general when you've had a long flat period, it's followed either by a sharp increase or a sharp decrease."


To me it implies we are about at the sharp decrease. I honestly thought we would ease our way into this recession. Instead, we seem bound and determined to hit the wall as fast as we can.

Got popcorn?
Neil