California Unemployment Increased to 12.2% in August (includes look at 20 largest cities) (Los Angeles: 2011, lease)

[user_id]

Originally Posted by bayarea-girl

user_id, to my knowledge I thought the unemployment numbers were derived from jobless claims filed and wage reports from payroll processing companies. If I am wrong how are the numbers being formulated?

No, that is not how its figured. I'm not sure even why that is such a widely held belief. If you are interested, just read the methodology from the BLS:

"Some people think that to get these figures on unemployment, the Government uses the number of persons filing claims for unemployment insurance (UI) benefits under State or Federal Government programs. But some people are still jobless when their benefits run out, and many more are not eligible at all or delay or never apply for benefits. So, quite clearly, UI information cannot be used as a source for complete information on the number of unemployed."

How the Government Measures Unemployment

Originally Posted by bayarea-girl

It is very frustrating because our economy is not stable.....

I'm not sure what you mean, most measures of economic health have started to stabilize/recover, that is why you hear so much talk about "the end of the recession". Unemployment always lags the recession, meaning the economy takes a nose dive before the unemployment numbers get bad and the unemployment numbers stay bad even while the economy is starting to recover. This recovery is likely to be a "jobless recovery", meaning that although the economy is growing (largely due to population growth) the unemployment rate will remain high for a number of years.

[FresnoFacts]

Originally Posted by bayarea-girl

user_id, to my knowledge I thought the unemployment numbers were derived from jobless claims filed and wage reports from payroll processing companies. If I am wrong how are the numbers being formulated?

The jobless info for California by the EDD is calculated in a data model with several components. The UI claims are one part but there are several other inputs used in the model. Another component is a household survey of a sample of Californians.

More info from California's EDD here:
Ask an Economist -- My unemployment insurance benefits have expired but I am still unemployed. Am I counted in the unemployment figures reported by the government?

[bayarea-girl]

Ok, just read both attachments. The formula for calculating the unemployment rate is REALLY messed up and I totally don't agree with the method which is the Current Population Survey (CPS).

Just to be clear when the news channels talk about the rate or the data they state it is based off of jobless claims filed & payroll reports, they clearly state that. I usually watch ABC & CNN. And I do know and realize that people who run out of benefits, those that are fired, PT workers, etc are not counted. Saying all that the unemployment numbers are probably REALLY freaking HIGH (higher than we know them to be).

The problem with this recession and the problem for this Administration are that the sentiments of the people who are experiencing the recession think that it is far from over and this line of thought has economist worried that this will turn out to be a depression. The US economy has made steady gains for the last 6 months and yes jobs are last to follow in a recovering economy but a lot of our jobs have been outsourced. The US economy is not very stable because we owe so much money to other countries, are in these two never ending wars, our housing market has yet to improve, and we are not producing things we can export.

I'm not an expert but just stating my viewpoint and looking at from a business perspective. I believe in our country but we have to improve the game plan. Even the film industry which is so CA and very Americana is filming in other places (has done so now for a while) but that says a lot.

The other day I got a notice that we shouldn't expect 3 weeks of vacation. My hubby was knocked down to 2 weeks. People I know have already taken pay cuts and or are working viewer days. So like the housing market it is going to take us a couple of years before things stabilize and new jobs are created. Otherwise we might have to keep printing $$. I don't believe everything the media and or government have to say completely, I believe in more of what I see and experience.

[user_id]

Originally Posted by bayarea-girl

The formula for calculating the unemployment rate is REALLY messed up...

Its hardly "messed up", its just imperfect. But any methodology is going to be imperfect.

Originally Posted by bayarea-girl

Just to be clear when the news channels talk about the rate or the data they state it is based off of jobless claims filed & payroll reports, they clearly state that.

I don't recall hearing a news source stating this, although they often mention both figures together giving one perhaps the impression that they are related.

Originally Posted by bayarea-girl

The US economy is not very stable because we owe so much money to other countries, are in these two never ending wars, our housing market has yet to improve, and we are not producing things we can export.

The amount of debt held by foreign governments/individuals is irrelevant to the stability of the economy. Not sure what you mean about the housing market, the housing market is starting to stabilize and its becoming more and more affordable.

The last thing you mention is just a myth. The US exports approximately 1.4 trillion of goods/services, just a bit less than China. Incidentally, California has one of the larger export based economies (compared to other states).

[bayarea-girl]

The housing market is not starting to stabilize. Maybe where you live. This time next year there will be more foreclosures.

In terms of the US exports I believe we import more than we export. I could be wrong but what are our main exports? It appears to me that we import more goods and services from India, China, and Japan when we aren't borrowing money from them.

[user_id]

Originally Posted by bayarea-girl

The housing market is not starting to stabilize. Maybe where you live. This time next year there will be more foreclosures.

I'm speaking about California in general. The foreclosure rate, like the unemployment will lag the recovery. Now, foreclosures are often being driven by job loss rather than gambling in the housing market. But sales seem to have stabilized, total months of inventory has stabilized, and prices have a also stabilized (this is likely due to the selling season, but last year prices declined during the selling season).

Originally Posted by bayarea-girl

In terms of the US exports I believe we import more than we export. I could be wrong but what are our main exports?

Although it has improved greatly over the last 2-3 years, the US has a modest trade deficit that at this point is mainly the result of trade imbalances with China. But that is a far cry from "the US does not produce anything we can export". We produce plenty and export 1.4 trillion in goods/services. What are the main exports of the US? Industrial supplies. This is part of the reason why so many people think the "us does not make anything", because the average Joe is not out purchasing industrial equipment. Besides industrial supplies, things like food, automobiles, planes make up a decent percentage. California plays a major part in US exports!

[bayarea-girl]

Here is the problem I am having with people who are projecting that the unemployment will lag the recovery and that the recession is over, it doesn't make sense. If the economy was truly stabilizing so would the employment situation. You wouldn't see many people on a continuous monthly and or daily basis loose their jobs and you wouldn't see the national unemployment rate continue to go higher all at the same time. I could understand if no one was getting hired and there was a small percent of people being laid off. But that is not what is going on.

The housing market in CA is really bad and we have yet to see the worst of it. First, we don't know how many properties the banks are holding onto. Secondly, there are so many people who's mortgages are set to re-set by the end of this year into next year. That means more foreclosures if they aren't able to refinance and or do some sort of loan modification (which we all know is a complicated process). Then you have commercial property that is foreclosing and even apartment complexes are having trouble filling their vacancies.

Then in terms of the US exports, I will have to gather some articles about this and do a follow up but what others have said is that we are not producing anything new. Our exports are not in high demand and we are importing more. Food and automobiles we are being beat on very easily. No one is buying our cars not even Americans. Sure CA plays a major part in exports because our main export is technology and film. But the technology is being outsourced rapidly and I'm not sure of where the film industry is going. Hollywood has been laying off people left and right in this economy and is setting up shop in other places outside of CA.

[user_id]

Originally Posted by bayarea-girl

Here is the problem I am having with people who are projecting that the unemployment will lag the recovery and that the recession is over, it doesn't make sense. If the economy was truly stabilizing so would the employment situation.

Well, it may not make sense to you but this is how things usually occur. If you look at historic data you'll find that the unemployment rate lags the recovery, this in economics is known as a "lagging indicator".

But think about it for a second. When the economy starts to look negative businesses don't all rush to start laying off people, rather they slowly lay off people in response to reduce sales, etc. That is why the unemployment rate is usually pretty low at the onset of a recession. Businesses also don't rush out and start hiring people either though, rather they are very caution and slowly start hiring again as things improve.

Originally Posted by bayarea-girl

First, we don't know how many properties the banks are holding onto. Secondly, there are so many people who's mortgages are set to re-set by the end of this year into next year.

1.) You can look up pre- foreclosure data and there are a number of estimates of so called "shadow inventory". 2.) Resets are a non-issue, rates are rather low right now. The problem is when things like option-pay ARMs recast into fully amortizing loans, but these loans make up a relatively small pool of total loans.


In terms of exports you can gather whatever you wish, but we export 1.4 trillion in goods/services and US exports are holding up. Given this its pretty hard to claim we don't make things others want.

[bayarea-girl]

It makes sense that as an economy is recovering that jobs are the last to be added. I'm actually not disbutting that. But it is hard to claim that the economy is doing better and we are out of the recession when job losses continue to be high on a monthly and daily basis. Again, if there was a significant reduction in layoffs and I am not talking a 10,000 reduction per month then I might agree with you that we are turning the corner. We are still experiencing a record number of unemployed people each month. It is probably higher than you and I even know about. Things have to stablize, and by stablize I mean you don't see the unemployment rate continue to get higher.

Yesterday I left my house from Walnut Creek around 8 AM and made into SF at around 8:35. There was NO traffic. Then I thought to myself was there a holiday I don't know about, nope just a reflection of where our economy is. Not nearly enough people are commuting because they are unemployed. BART ridership is down too. Then I started looking around and there were so many retail spaces for lease. I've already mentioned this but it was so sad. Businesses can't get a loan right now nor can the average Joe that wants to buy a home.

Housing numbers will be a big reflection of the unemployment situation/stability of our economy. The housing situation I have been following almost on a daily basis. Right now more investors are buying because they have the cash to do so. People aren't buying up because they can't get rid of their properties unless they do a fire sale and or they can't get the jumbo loan. I have checked to see the pre-foreclosure rates I actually check to see which areas have the most defaults and who have notices for auction, and the number is still high. There are many projections out there that we are not out of the woods when it comes to foreclosures. We've actually went over this topic before on another thread. CNN covers this every weekend on a show called Your $$$. They are following CA very closely because when we turn the corner other states will follow. If people are employed without fear of loosing their jobs they will buy. What is selling right now is foreclosed properties. The majority of people that are selling are banks and or people that owe a lot of money to the banks that they can't repay and have to sell.

Now interms of exports, Texas has the highest exports from the US not CA according to the following data.

U.S. Exports by State
Decline In U.S. Exports Hurts Jobs At Home : NPR
Calculated Risk: U.S. Trade: Exports and Imports Decline Sharply
U.S. farm equipment exports decline 20 percent in first half of 2009 | Farm and Dairy - The Auction Guide and Rural Marketplace

What I said was that we aren't creating anything new that others want. That is true. If our prices are too high for what we already are sending out then someone else (probably in the Asian market) will make it cheaper. We actually have a goods and services deficit: which means imports increased more than exports (means we aren't selling much).
Foreign Trade - MAIN
US Exports, Imports and the Balance of Trade:

[user_id]

Originally Posted by bayarea-girl

It makes sense that as an economy is recovering that jobs are the last to be added. I'm actually not disbutting that. But it is hard to claim that the economy is doing better and we are out of the recession when job losses continue to be high on a monthly and daily basis.

Huh? So you understand that jobs lag the recovery, but then continue to say that its hard to claim that the economy is out of a recession until unemployment improves?! That is contradictory... Unemployment has always lagged the recovery, sometimes there is a shortish lag and sometimes its longer.

You just seem to be interpreting "end of recession" with "everything is good now", but this is not accurate. All it takes for the recession to end is for the economy to stop declining in size.

Originally Posted by bayarea-girl

Yesterday I left my house from Walnut Creek around 8 AM and made into SF at around 8:35. There was NO traffic.

There has only been a modest decline in total miles driven, nothing dramatic and not big enough to be that noticeable.

Originally Posted by bayarea-girl

Businesses can't get a loan right now nor can the average Joe that wants to buy a home.

The reason why you see so many retail vacancies has little to do with businesses not being able to get loans, rather they overbuilt commercial real estate. There is simply too many retail properties and its going to take awhile for them to get utilized. The average Joe can purchase a home just fine, its actually easier to get a mortgage right than it was just 10 years ago.

Originally Posted by bayarea-girl

Now interms of exports, Texas has the highest exports from the US not CA according to the following data.

I never stated that California has the biggest export market, I said that California has a large export economy and it does. Texas has a larger one, California is second after Texas. The difference between Texas and California is largely due to oil/energy related industry. California's large export economy is going to help it, luckily the real estate interests did not totally kill it.

Originally Posted by bayarea-girl

What I said was that we aren't creating anything new that others want. That is true.

Again, its hard to suggest that we are not "creating anything new that others want" when we export 1.4 trillion in goods/services. The fact that there is a modest trade deficit does not change the fact that the US is one of the top exporting nations!

Around half of the trade deficit is due to oil imports.