Preparing for tomorrow’s BLS unemployment report

Posted by: Joel Capperella

You may have noticed that we tend to be pragmatists here. Especially when it comes to the monthly Bureau of Labor Statistics (BLS) reports on unemployment. A recent CNNmoney.com article on the jobs market indicates that tomorrow’s BLS numbers will be more good news to the economic world, and those of us who depend on employment in our day-to-day.

Payroll processing firm ADP reports that private-sector employers cut 84,000 jobs in December, the fewest since March 2008. The story also includes some very optimistic suggestions about 2010 in general, including this from Joel Prakken of Macroeconomic Advisers: “We’re moving in the right direction, and I think we’re only a month or two away from reporting a positive top line number.”

Let’s hope that Mr. Prakken is correct, but in the mean time, let’s prepare for some more moderate possibilities.

First, it should be noted that we, too, have seen positive signs. While the holiday season had a slight impact on temporary staffing, it continued to move in the right direction. Additionally, we are seeing some firms start to benefit more from the economic stimulus. Including some defense service organizations who, at the beginning of the new administration, had placed some large projects on hold. This capital seems to be becoming more accessible and is translating into an increase in contract employees.

While all of this certainly should be considered positive, we must remember that the incremental job cuts ADP reports refer to the newly unemployed. We are still adding to the ranks of unemployment and in some cases, no longer counting the discouraged worker in the total number. The employment situation remains tenuous at best. And at 10+ percent unemployment (we’re predicting that tomorrow’s numbers won’t fall too far from November’s), we continue to have a long way to go until we are in the black.

Cautious optimism remains the call. And preparation for handling what could potentially be massive post-recession movement due to war-weary employees who are unhappy, but currently not secure enough to go looking.