Looking at the Jobs Numbers

While jobs data is relentlessly bad these days, for those of us still required to make a living, finding nuggets of information that can improve decision making is worth the effort of checking these numbers in detail.  I read the jobs data pretty religiously with a focus on geographic,  industry sector and size information.  There are two reasons I do this.  Honestly, sometimes seeing another area or target market that's worse off than mine makes me feel better.  It's not necessarily a productive use of time, but it does dispel some gloom.  The flip side is seeing where there might be opportunity driven by either

-  the biggest  new problem areas, or

-  specific areas of economic pick-up.

 The most recent Department of Labor jobs reports shows a decline in the number of jobs, primarily due to less employment in government.  Total public sector jobs are down by 159,000, while the private sector added 64,000 jobs in September.   For context, economists estimate it will take additions of 150,000 jobs a month to keep the unemployment rate flat.

   The data from Small Businesses is mixed.  According to the National Federation of Independent Business in September only 8% of small business owners said they plan to increase staff this year.  Contrast that with the Business Roundtable Economic Outlook Survey update that shows 31% of large firms are looking to hire.  The latest ADP / Macroeconomic Advisers data shows firms with less than 500 employees cut 28,000 jobs last month.  (Companies with more than 500 employees laid off 11,000 US workers in the same time period.)  Interestingly, really small companies (less than 20 employees) did add jobs.  According to Intuit’s Small Business Employment Index  the less than 20 employees segment grew by 27,000 jobs in September.  That still puts small business job growth at a run rate of only 1.6%. 

What stands out about this addition to the really-small business workforce is that access to credit for small business remains a big problem. The SBA loan guarantee enhancements that expired in May were renewed in the new Small Business Jobs Act, but only until the end of 2010.  While it may be hard to borrow money now, it sounds like it’s only going to get more difficult.  (Note to self, ask local bank rep about this and pass on intel to clients.) That said, somehow it's the least likely to be credit worthy that are hiring (albeit at an anemic rate).  Presumably this is a mix of the SBA program having an impact or some business improvement that produced enough working capital to finance new workers.  Hopefully this little hiring increase can be interpreted as a green shoot from the people who by necessity run the leanest businesses around.