Sorting out mixed message of unemployment numbers

February 4, 2011 7:28:46 PM PST
The latest jobless numbers are out and unemployment has dropped to its lowest level in two years, but that number does not match what companies are reporting in terms of new jobs.

Every month ABC7 report a couple of numbers: the unemployment rate and the number of jobs created. Now, both those numbers came out for the month of January and they're wildly divergent.

Nationwide employment fell from 9.4 percent down to 9.0 percent. Yet employers barely added any jobs, just 36,000 -- a small fraction of the 150,000 jobs that most economists expected.

"Thirty-six thousand jobs added in a single month isn't even enough to keep up with the new workers the economy adds every month," says ABC News business editor Dan Arnall.

Arnall says the numbers don't add up and it's because the numbers rely on two different surveys. The unemployment number comes from a census survey of 60,000 homes and last month that household survey showed an increase of 589,000 jobs, people saying they'd found employment. The number of unemployed fell by a similar number. That would account for a big drop in the unemployment figure, but the new jobs number of 36,000 that comes from another separate survey, a jobs survey. Every month a list of companies and government agencies reports how many people they employ.

But small businesses don't report every month in that jobs survey and hiring at small businesses could account for a big part of the employment increase that we're seeing in the household survey. But at the unemployment office in Oakland the numbers are pretty meaningless, if you don't have a job.

"It hasn't trickled down to me if it is getting better," says Annie Gowan.

Gowan has a master's degree in English from Mills College. The former librarian has not been able to land a full time job in two years. Her last application was for a Target store.

"I'm hoping they'll call me in for an actual interview," says Gowan.

At a Jobs Corp center on Treasure Island Rep. Barbara Lee, D-Oakland, was touting Friday's drop in the unemployment numbers. Outside, Jean Carlos Seda-Sanchez is at his brand new job working for a private security company.

"I was a high school dropout so, I found out about this program and it just boosted me up," says Seda-Sanchez.

Seda-Sanchez was trained at the Job Corp center. He's still going to school there getting his high school diploma. For him the economy is obviously better.

"By the skills they taught me I got the job pretty easy," says Seda-Sanchez.

A high school dropout finds a new career and a woman with a master's degree is still looking -- it is a reflection of a very mixed jobs report.

Politically, both sides are spinning the numbers to suit their agenda and here in California unemployment remains above 12 percent and with more budget cuts coming, there is likely to cause more pain.

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