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Friday, November 02, 2007

 

employment ratio falls again


today's non-farm payrolls report was received by many as good news, but this again strikes me as bogus interpretation by highlighting the headline number without examining the report for more vital clues. angry bear does better:

The employment to population ratio fell from 62.9% in September to 62.7% in October as the household survey recorded an employment decline of 250,000. The labor force participation rate also feel from 66% in September to 65.9% in October.


the employment ratio, or emratio, continues to tick lower and is now down 1.1% from its december 2006 peak (63.4%). the quality of the figure as a recession forecaster was noted in the update here, and below is a linked chart from the saint louis fed.



there's more commentary regarding emratio and other employment metrics in this september 2007 zack's report. it seems exceedingly likely that, as emratio falls, we are either on the cusp of or already in a recession that will be apparently only when current data is later revised.

UPDATE: via minyanville, jim rogers speaks truth to bloomberg.

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