Last Friday NFP recorded 247 K job losses in the U.S. for the month of July. However, the unemploymentrate came down from 9.5% in June to 9.4% in July. Even though the economy is losing jobs, the unemployment rate is coming down. What is the catch here?

No catch. The explanation is probably that people give up on trying to find a job and leave the statistics. It is not always easy to track the unemployment rate since people have to be searching for jobs while the government knows about it ie they have to report to an employment agency or something like that. Hence, that the unemployment rate falls is not neceserally a sign that employment increases or that the people who no longer are a part of the unemployed have found something to do. They may have gone into criminality, moved abroad, started living off their parents or wealth or gone to the woods. HTH

Maybe:- retirement- mortality- people giving up on searching for a job- people trying to start up their own job!?...Check the actual statistics numbersTable A. Major indicators of labor market activity, seasonally adjusted (Numbers in thousands) _______________________________________________________________________________ | | | | Quarterly | | | averages | Monthly data | June- Category |_________________|__________________________| July | | | | | | change | I | II | May | June | July | | 2009 | 2009 | 2009 | 2009 | 2009 | _________________________|________|________|________|________|________|________ | HOUSEHOLD DATA | Labor force status |_____________________________________________________ | | | | | | Civilian labor force ....| 153,993| 154,912| 155,081| 154,926| 154,504| -422 Employment ............| 141,578| 140,591| 140,570| 140,196| 140,041| -155 Unemployment ..........| 12,415| 14,321| 14,511| 14,729| 14,462| -267 Not in labor force ......| 80,920| 80,547| 80,371| 80,729| 81,366| 637 |________|________|________|________|________|________ | | Unemployment rates |_____________________________________________________ | | | | | | All workers .............| 8.1| 9.2| 9.4| 9.5| 9.4| -0.1 Adult men .............| 8.2| 9.7| 9.8| 10.0| 9.8| -.2 Adult women ...........| 6.7| 7.4| 7.5| 7.6| 7.5| -.1 Teenagers .............| 21.3| 22.7| 22.7| 24.0| 23.8| -.2 White .................| 7.4| 8.4| 8.6| 8.7| 8.6| -.1 Black or African | | | | | | American ............| 13.1| 14.9| 14.9| 14.7| 14.5| -.2 Hispanic or Latino | | | | | | ethnicity ...........| 10.7| 12.0| 12.7| 12.2| 12.3| .1 |________|________|________|________|________|________

QuoteOriginally posted by: freddiemacNo catch. The explanation is probably that people give up on trying to find a job and leave the statistics. It is not always easy to track the unemployment rate since people have to be searching for jobs while the government knows about it ie they have to report to an employment agency or something like that. Hence, that the unemployment rate falls is not neceserally a sign that employment increases or that the people who no longer are a part of the unemployed have found something to do. They may have gone into criminality, moved abroad, started living off their parents or wealth or gone to the woods. HTHProbably fertility has skyrocketed since people were not so busy with their (former) jobs.... Another hint. Seek for the "official" definition of unemployment and any changes of this over time.eg. what are the max hours of work per week to be removed from unemployed lists? If i work part time, while i need a full time job but i cant get one, am i employed or unemployed? Strictly speaking i am half employed half unemployed. But government stats dont foresee such a category.If i were a laid off surgeon, now working as a butcher, or a laid off accountant now working as a cab driver, should i be considered as employed? This is hetero-employement by definition. Not employment.

A good explanation from Krugman here