The widely followed ADP Employer Services jobs report shows that 697,000 jobs were lost last month, suggesting a very large unemployment number when the government data is released on Friday. I have indicated in the past that seasonal factors have artificially kept down jobless claims and I anticipate large surprises to the upside as these seasonal factors become apparent.

While job losses of 598,000 in today’s report for January 2009 were more than the 525,000 expected, it was within the expected range. Evidence of this comes from the increase in long-term treasury yields and stock futures prices immediately after the announcement.

Nevertheless, the number was the largest since 1974 and clearly indicates that the employment market is weak. We have now lost the greatest number of jobs in three months since data keeping began in 1939 – another data point which is telling. The unemployment rate also surged to 7.6%. However, we are nowhere near the bottom. Expect the unemployment rate to surge into double digits before the Depression ends. (Note: I had previously remarked I anticipated the unemployment rate to peak above 9%. I now expect the rate to be much higher than that).

Below is the heart of the U.S. Department of Labor’s employment situation summary accompanying the numbers. I have highlighted the most salient details.

A survey in China has determined that job losses amongst migrant workers are three times worse than had been reported. In fact, 20 million workers in China have already lost employment.

Evidence that companies think that much of the downdraft in the economy represents a structural shift to a lower revenue base instead of a cyclical shift comes from the enormous goodwill writedowns companies are taking.  Case and point is the $34 billion writedown by ConocoPhilips which I highlighted (Note of disclosure: I am fairly bullish [...]

If you recall, last month the figure was quoted at 533,000 jobs lost in November and unemployment came in at 6.7% (now revised up to 6.8%), up from 6.5% in October. The consensus estimate for December, according to Bloomberg was for 7.0% and 525,000 jobs lost. So, the consensus was expecting a repeat of November.

ADP, the payroll data company, has shown that the United States is going to see an even larger loss of jobs in December than we saw in November when the Bureau of Labor Statistics releases its figures this Friday. The number ADP put out is absolutely staggering: 693,000 jobs lost.

Needless to say, this number would confirm that unemployment will rise to at least 9 percent if not into the double digits before the recession is over.

Below is a story from the Guardian where they review the ADP numbers and detail new job cuts at Alcoa.

The Bureau of Labor Statistics just released this month’s unemployment report and the data were grim.  The unemployment rate rose to 6.7%, while the economy shed 533,000 jobs – the largest decline since 1974.  The result was widely expected to be bad, but yesterday we heard even more announcements of job cuts, ensuring that the [...]

My very first post on this blog was in March and it was titled “The Economy Is Definitely In Recession.” Back then, this seemed like a stretch for a lot of people, but today the National Bureau of Economic Research (NBER), which makes the official recession call for the U.S., determined that the recession began in December 2007.

After stalling at 6.1% in September, the U.S. unemployment rate jumped to 6.5%. This was a truly ugly report as we saw payrolls go down by 240,000 – more than forecast and September was revised up significantly from 169,000 to 284,000. August was revised up 54,000 as well. These were enormous revisions, putting [...]

Yesterday, I laid out some of my general thinking on the business cycle and the economy. Obviously, understanding the business cycle is important to economic forecasting and is, therefore, central to personal financial planning, general investing and business planning.
Over the next few weeks, I will chart out a panoply of data sets for the [...]