Many people were quite interested in seeing today’s Jobs Report. The overall Report looks at Non-Farm Jobs, and the Unemployment Rate. This was the first such report coming out after the two Political Conventions–HENCE THE MORE BROAD-BASED INTEREST. Would that help or hinder any “bounce”?
The US Dept. of Labor, the keeper of such statistics, focuses on Non-Farm Jobs. That is because it is difficult to maintain statistics, on a month-by-month basis (throughout the year) for Agriculture. That’s because most crops are harvested in just a few months, during the year. And, a bit less in the colder climates.
The DOL uses “Statistical Smoothing” to blend the predictable short-term Retail Shopping Seasons around Easter and the Back-to-School Period. The Holiday Season is also assimilated, even though it is broader and lasts longer. Today, that Report showed an increase in Non-Farm jobs of 96,000 and a reduction in the Unemployment Rate, from 8.3% to 8.1%.
Although the Markets had expected a higher Increase in Jobs,, the result seem to be taking back just a little bit of what they had built-in, with anticipation of a higher growth. As it turns-out, the DJIA closed up a mere 5.81 points today (basically a neutral performance).
I have written Posts before which noted that, oftentimes, its not the reported number; but, how that compares with what was anticipated. Well, Jobs Numbers have to be looked-at over a longer-term period, not just one month versus the next. The Smoothing of jobs over seasonality, and the various anticipated shopping seasons, is always a best-try effort. But, there are other, unanticipated differences that cannot possibly be anticipated–or factored-in. During May and June of this year, Manufacturing Jobs increased because there had been “Re-Calls”. Accordingly, if the Job Base goes up unexpectedly in one period, it is natural to expect that it might not rebound as much in the next. I believe that is what happened. Accordingly, the Stock Market was Neutral on the day.
If you are wondering whether you are better-off today, just think of where the Country was during the turn-over, from Bush to Obama. We were having 1,000+ point plus swings in the Dow Jones Industrial Average. (I know, I was there!) The Dow Jones Industrials had just dropped from1 14,000 to 6,500. 401(k)s, IRAs and Housing Values were in the Toilet. And, everyone surely knows someone who lost their job, and saw their home fall into Foreclosure.
So, when you (hopefully) go to the Polls to vote, in November, Please vote with your Heart and Your Mind, and not your Pocketbook.