Unemployment Rate Rises for 22nd Straight Month

The unemployment rate continues to rise. The unemployment rate has hit 10.2 percent. This unemployment rate reflects an increase over 10 percent for the first time since 1983.

Chris Isidore, CNNMoney.com Senior Editor, has posted an article titled "Unemployment hits 10.2%." In his article he discusses the fact that this reflects a continued weakness in the labor market.

The unemployment rate was 9.8 percent in September and economists had predicted it would just jump to 9.9 percent in October. They were wrong.

The Labor Department had predicted there would be 219,000 lost jobs in September. There were 190,000 jobs lost in October but this was higher than that predicted by the Labor department which was 175,000.

David Wyss who is the chief economist with Standard and Poor's said that the only good news is that layoffs are down.

Something that is not surprising is that college grads are finding more jobs than those people who have no skills. Additionally teenagers are suffering with a 27%-plus unemployment rate.

An interesting comment is made in the article and that is that as employers are making money and battling out of the doldrums they are making intelligent business decisions with respect to workers.

In other words, the goal of the government and the goal of business doesn't remain the same for the "entire trip."

If I am a business owner, while I am pleased to walk the path with the government for recovery as long as I benefit, once I have benefitted I then move to my own path.

David Wyss was not able to "massage" the data to make it look good. He said he just doesn't see any good news at all.

Jobless benefits have been extended and there is an increase in temporary hiring has been called good news.

That is not necessarily good news.

Back in the 1970s the typical job was a 40-hour work week. A person would have studied in a particular field and then would go to work for a firm. They would hope to grow with the firm and retire there. The company would provide medical benefits as well as a pension.

Ultimately there was refinement in financial laws and employees and employers worked hand-in-hand to create retirement packages.

However, in the 1980s and 1990s there was a shift to the 30-hour-per-week employee. This person didn't get benefits and yet they worked enough that they were expected to be skilled.

Another effect this had was a reduction in overtime.

If a firm had an employee slot that required and $8-per-hour full-time employee, in the 1970s this meant $320 plus benefits. If they needed 20 hours of overtime that would be paid at "time-and-a-half" or an additional $240. In the 1970s the cost would be $560 plus benefits. In the 1990s it would be $480, period.

I return to my Business 101 textbook. Until businesses are willing to take their "responsibility to society" seriously; there will be no long-term recovery.

References:

http://money.cnn.com/2009/11/06/news/economy/jobs_october/?postversion=2009110609

Personal Experience