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November unemployment: Why the big drop?

Job seekers line up to apply for an opening with Major League Baseball's Miami Marlins on Nov. 15, 2011 in Miami, Fla.

Good news on jobs and no, that's not a typo. The Labor Department reported that 120,000 new jobs were added in November and the unemployment rate dropped to 8.6 percent, the lowest rate since March 2009. There was also a pleasant surprise in terms of the past two months: an additional 72,000 jobs were added in those months.

Why the big rate drop?

The new jobs-added numbers were good, but they don't explain the big drop in the unemployment rate. This is one of the more confounding parts of the data: there are two different surveys on which the Labor Department relies to determine the number of jobs added and the unemployment rate, so the two readings can sometimes seem at odds, as is the case in this report.

The drop in the unemployment rate comes with an asterisk: while there was a 278,000 gain in employment, there was a concurrent the labor force decline of 315,000 from October. It would be far preferable for the unemployment rate to drop because the economy is creating over 200,000 per month consistently, rather than due to would-be employees leaving the work force, either because they're retiring or they're simply too discouraged to keep looking for a job. If some of those people resume their job searches, we could see the unemployment rate tick up next month.

The bad news

8.6 percent unemployment is still a very high rate. In fact, the jobless rate has remained above 8 percent since February 2009, the longest stretch since monthly records began in 1948. Additionally, there are still 5.7 million long-term unemployed (jobless for 27 weeks and over), which represents 43 percent of the total unemployed and the average duration of unemployment rose to 40.9 weeks, the highest on record.

Also, of the 120,000 new jobs created, 50,000 came from the retail sector, which includes a number of employees added for the holiday season. The big question is whether those people will keep their positions beyond Christmas.

But for today, we should take the improvement and hope that a combination of mildly better than expected domestic news, plus some hope that the Europeans will reach a conclusion on the debt crisis, will deliver a holiday gift to the global economy.

November Jobs Report:

-- Jobs Created: +120,000 (October and September revised up by 72,000)

-- Private Sector Jobs Created: +140,000 (from +104,000 in October)

-- Government: -20K (Nearly 550,000 total government jobs lost since peak in September 2008)

-- Unemployment Rate: 8.6 percent (lowest rate since March, 2009)

-- Under-Employment Rate (marginally-attached, part-time): 15.6 percent (from 16.2 percent last month -- in 2007, the rate was 8 percent)

-- Total Number of Unemployed: 13.3 million (from 13.9 million)

-- Average monthly jobs gained in 2011: 132,000

-- Total Jobs Lost since beginning of recession in 2007: 6.2 million

-- Long-term unemployed (jobless for 27 weeks and over): 5.7 million representing 43 percent of the total unemployed (from 5.9 million)

-- Average duration of unemployment: 40.9 weeks, the highest on record

-- Average workweek: 34.3 (unchanged)

-- Average Hourly Earnings: down $0.2 to $23.18 (over past year, earnings up 1.8 percent)

For more analysis, listen to Jill's interview on the Marketplace Morning Report.

About the author

Jill Schlesinger is editor-at-large for CBS/MoneyWatch.
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The jobs report, like most federal govt statistics is being massaged and the metrics changed periodically to suit the combined wisdom of the Labor, Commerce, Treasury Departments and the Fed. There is no new hiring except replacement hiring in fast food and low end retail. All other sectors are still bleeding arterial blood in the US and the only reason outsourcing isn't growing is that business is so bad in all manufacturing and retail that no new bodies are needed anywhere globally except in certain hot-house sectors related to the military or US AID that "shakes hands" with State Dept or DOD suppliers/NGO's, etc. The actual unemployment rate, if calculated as it was in 1932, would be 17% or higher. This is all just nonsense. Actual per capita income median is dropping like a rock, and so many folks that are earning are doing so off the books that there will be many unintended results: among others, income tax receivables are going to fall off 20% regardless of attempts to claw back from the rich. This is all manipulation for the sake of major account holders in hedge funds and trading house/banks like Goldman and JPMorgan. The economy is a completely rigged fascist mess most closely patterned after Mussolini's Italy, not Keynes' pipe dreams, Smith's modified laissez faire nor Ayn Rand's misanthropic vileness.

Housing has yet to hit bottom in the Northeast, being bouyed by rental incomes on multi-family units that are everywhere beginning to exceed their occupancy certificate limits (families and singles doubling or tripling up). The cluelessness of the banks, the regulators, the administration, state tax boards, zoning boards and planning and even local municipal "planners" is mind-boggling. And the push by Republicans to make US patriot act provisions more draconian by suspending habeas corpus and rolling back the Constitutional requirement to face one's accuser at a speedy trial is not being done for the sake of terrorism concerns: it is being done to address what is coming: civil unrest in the USA that hasn't been seen since the mid 30's. The only reason we aren't seeing this already is due to the New Deal, and now Boehner, Cantor, McConnell and the tea party WASP braintrust wants to roll that back with Glass Steagal. Occupy Wall Street was critiqued as rudderless, with unintentionally shattering comments like: "the protesters moved out and the homeless moved in." Images of the Hoovervilles (and the National Guard headbreakings that followed) come to mind. Want to balance the budget while putting everyone to work? Start by evacuating Iraq, Afghanistan now, decommissioning the 7th fleet and putting away the big stick: the USA will be a second rate power in 5 years regardless.

The biggest manipulation is the lie of "deflation". What we are all masking with our addition to credit liquidity is that the actual obligations due on the deadly CDS, CDO and other fraudulently equitized "assets" at the center of the derivatives mess CAUSED BY WALL STREET are hundreds of times the price tag of their short covers. In other words: until we repudiate these debts as based on counterfeit of the faith and trust of the USA (due to AIG insurance and Fannie/Freddie ownership) and as such, worthless, there can be no market correction and swing to growth. Hank Paulsen stole our checkbook to write 100 cents on the dollar on debts we didn't owe, and now everyone is going to the same well day after day. The result is, must be and will be hyperinflation. Figurative wheelbarrows of money required to buy staple foods and cereals. And all the jobs that supported our collective greed are gone FOREVER.

So, to answer: who cares? The numbers are lies. The sources are in collusion with the miscreants. No one can afford to tell the truth for fear of jeopardizing a "soft landing". Only problem with Bernanke, Geithner and Blankfein's idea is that THERE IS NO BOTTOM when the market is based on a complete lack of trust.

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