June Jobs Numbers Really Just More of the Same

"Unchanged" statistics mean bad news for unemployment; outstanding consumer credit edged upward in May; and Washington is no closer to averting a U.S. debt default.

The headline employment news might have been the next-to-zero growth in jobs in June and the official unemployment rate’s upward crawl to 9.2 percent, but the Bureau of Labor Statistics had more than that to report on Friday. “Unchanged” was perhaps the most common term used by the BLS to describe the state of employment.

For instance, the total number of unemployed persons (14.1 million) was essentially unchanged fpr the month. Among the major worker groups that the BLS tracks, the unemployment rates for adult men (9.1 percent), adult women (8 percent), teenagers (24.5 percent), whites (8.1 percent), blacks (16.2 percent), and Hispanics (11.6 percent) showed little or no change in June.

Not only that, the number of long-term unemployed people, which the BLS defines as those luckless souls without work for 27 weeks or just a little over half a year, was also essentially unchanged over the month, at 6.3 million, accounting for 44.4 percent of the unemployed. The number of persons employed part time for economic reasons–working part time because nothing full time was to be had–was also essentially unchanged in June at 8.6 million.

In other words, more of the same, and the same is bad. Were there any glimmers of good news in the employment numbers? Indirectly, perhaps, but only if the U.S. employment situation has a hand in shrinking commodity bubbles, such as the price of oil, even further.

Credit-card debt sees unusual uptick

Outstanding consumer credit edged upward at an annualized rate of 2.5 percent in May, according to the Federal Reserve on Friday. The increase included both upticks in revolving and nonrevolving debt, but the revolving kind–mainly credit cards–led the way with an annualized increase of 5.1 percent.

Consumer credit has been on the upswing for some time now, but the precious increases were generally led by nonrevolving debt–car loans but also the likes of boat, mobile home and education loans. In fact, nonrevolving loans have been steadily increasing since the third quarter of 2010, while credit-card debt has been steadily decreasing since 2008.

Considering the jobs picture, it could be that the uptick in credit-card debt in May is just a fluke. In any case, at $793.1 billion, total outstanding nonrevolving debt is still well below that in 2007 and 2008, when it topped $940 billion during each of those years.

The debt-ceiling saga continues

A trillion here, a trillion there; pretty soon you’re talking real money. Talk of a $4 trillion deficit deal changed to a $2 trillion deal over the weekend, but no deal of any kind was done at the Sunday meeting between top members of Congress and President Obama. The president, for his part, said “we need to” work out something in the next 10 days. More talks on the debt ceiling are slated for Monday.

The new head of the International Monetary Fund, Christine Lagarde–who presumably has enough to do without a North American debt crisis to go along with various European ones–predicted “interest hikes, stock markets taking a huge hit and real nasty consequences” for the world economy if the United States defaults.

Wall Street had an unsurprisingly lousy day after the jobs report on Friday, with the Dow Jones Industrial Average losing 62.29 points, or 0.49 percent. The S&P 500 was down 0.7 percent, and the Nasdaq declined 0.45 percent.