Unemployment increase a statistical fluke?
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Unemployment increase a statistical fluke?
TEXT OF INTERVIEW
BRIAN WATT: The Labor Department released its November unemployment report this morning. Employers added 132,000 new jobs, but the unemployment rate went up a tenth of a percent. I talked with Standard & Poor’s chief economist David Wyss. He says this year’s holiday calendar had an interesting affect on the numbers.
DAVID WYSS: The unemployment rate went up because there was a big increase in the number of people looking for work. That was probably a statistical fluke caused by the fact that Thanksgiving came early this year, so as a result the November survey captured an awful lot of the mall rats who were out looking for jobs this time instead of just floating around the mall. A lot of the increase occurred in the 16- to 19-year-old age group and those are probably just people looking for those temporary Christmas retail jobs.
WATT: So where are the new jobs coming from this time?
WYSS: Well the jobs are coming almost entirely from the service sector. Service sector jobs rose 172,000. Only 18,000 of that was government so it was mostly the private sector, but very split within that. Strong increases in transportation, jobs. Retail was up at a pretty healthy rate. But the big increases were in professional and business services and in education and health care because apparently we all got sick before Thanksgiving.
WATT: I see. So what does that say about where the economy’s headed?
WYSS: The economy’s doing pretty well. We do see the economy slowing down to more like 2, 2.5 percent growth rate. It was 2.2 percent in the third quarter. We’d like it to be stronger than that but that’s probably about what the Fed wants right now. The Fed’s been raising interest rates to slow the economy down, they’ve succeeded, we do expect the unemployment rate to gradually move up over the next few months.
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