USA Unemployment Rate 8.3%, 5.6 Million Jobs Remaining to Be Restored

=> For Latest Updates, Visit OspreyFlyer.com <=




USA Jobs The January 2012 Unemployment Rate and Underemployment Rates dipped to 8.3% and 15.1%, respectively. These are post-recession lows, the lowest since February 2009. The USA economy created 243,000 jobs, the 16th consecutive month of job gains. Net job losses were 8.7 million during the 2008 - 2009 Great Recession. Net job gains have been 3.1 million in the subsequent 2010 - 2012 recovery, leaving 5.6 million jobs to be restored. A high hurdle still confronts the United States to maximize employment, but at least the trend continues slowly in a positive direction.


Unemployment Rate Per the Household Survey Data, the unemployment rate (U-3) decreased to 8.3% (preliminary) in January 2012, which is a 35-month low, the lowest since February 2009 (8.2%), plus a post-recession low. The Great Recession cyclical peak was in October 2009 at 10.1%.




Underemployment Rate Per the Household Survey Data, the underemployment rate (U-6) decreased to 15.1% (preliminary) in January 2012, which is a 35-month low, the lowest since February 2009 (15.0%). The Great Recession cyclical peak was in October 2009 at 17.4%.




Total Nonfarm Employment Monthly Net Change Per the Establishment Survey Data, total nonfarm employment monthly net change was +243,000 (preliminary) in January 2012. This is the 16th consecutive month of job gains (revised). The total nonfarm employment job losses bottomed during the Great Recession at -818,000 in January 2009. The best jobs gain subsequently has been +516,000 in May 2010, which was mostly attributable to the hiring of census workers. The best non-census jobs gains has been +251,000 in April 2011.




USA Net Jobs Gain (Loss) by Year Per the Establishment Survey Data, total nonfarm employment by year illustrates the Great Recession job losses and subsequent insufficient Recovery rebound. 2007 was the last year to create jobs before the Great Recession, at +902,000 jobs gained. Great Recession job losses began in 2008 at -3,603,000. 2009 was even worse at -5,060,000. This resulted in a total of -8,663,000 jobs lost during the Great Recession in 2008 and 2009. Total jobs regained in the 2010 - 2012 recovery to-date have been 3,090,000. The 2012 annual jobs gains is extrapolated from the months reported year-to-date.



=> For Additional Detail and Coverage, Visit OspreyFlyer.com <=

USA 2011 GDP Estimated at +1.7%, Drops from 2010

=> For Latest Updates, Visit OspreyFlyer.com <=




USA GDP 2011 Advance Estimate The Bureau of Economic Analysis released the advance estimate of 2011 GDP which was +1.7% YoY, for a total GDP of $15.088 trillion. This is a drop from the 2010 GDP of +3.0% YoY. The Great Recession GDPs were -0.3% and -3.5% in 2008 and 2009, respectively. There will be second and third estimates announced in February and March.


Where is the USA Economy Going? The Big Question: where is the USA economy headed? Three scenarios are usually discussed: 1) a double dip recession whereby the GDP will turn negative yet again with a higher unemployment rate, 2) the economy will continue "bottom bouncing" with slow to very slow growth and a continuing relatively high unemployment rate, or 3) the bottom is in and GDP growth will accelerate and the unemployment rate will begin to decrease. Scenario 2) with slow to very slow economic growth and a continuing relatively high unemployment rate appears to be the most likely scenario for 2012. The World Bank estimates 2012 GDP at +2.2%. The OECD estimate is +2.0%. The IMF is +1.8%. The Conference Board is +1.8%.


USA Real GDP % by Year (seasonally adjusted at annual rate) The peak before the Great Recession was +3.5% in 2004. A downward trend began in 2005 bottoming at -3.5% in 2009. The recovery has been +3.0% in 2010 and +1.7% in 2011.

  \


USA Real GDP $ by Year (seasonally adjusted at annual rate) The pre-recession peak was $14.292 trillion in 2008, followed by a Great Recession drop in 2009 to $13.939 trillion. The recovery has been $14.527 trillion in 2010 and $15.088 trillion in 2011, an all-time high.

 

Commentary The 2011 USA GDP (advance estimate) of +1.7% is a drop from 2010 and disappointing. The 2012 estimates noted above by The World Bank, OECD, IMF, and The Conference Board range from +1.8% to +2.2%. This would continue the recovery but be flat YoY from 2011 to 2012. A recession in 2012 does not appear probable, but continues as a low risk.


The Bureau of Economic Analysis Gross Domestic Product: Annual 2011 (advance estimate) January 27, 2012 Real GDP increased 1.7 percent in 2011 (that is, from the 2010 annual level to the 2011 annual level), compared with an increase of 3.0 percent in 2010. The increase in real GDP in 2011 primarily reflected positive contributions from personal consumption expenditures (PCE), exports, and nonresidential fixed investment that were partly offset by negative contributions from state and local government spending, private inventory investment, and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased. The deceleration in real GDP in 2011 primarily reflected downturns in private inventory investment and in federal government spending and a deceleration in exports that were partly offset by a deceleration in imports and an acceleration in nonresidential fixed investment.

=> For Additional Detail and Coverage, Visit OspreyFlyer.com <=

USA Fourth Quarter GDP Estimated at +2.8%, 6-Quarter High

=> For Latest Updates, Visit OspreyFlyer.com <=




USA GDP Q4 2011 Advance Estimate The Bureau of Economic Analysis released the advance estimate of Q4 2011 GDP which was +2.8% QoQ, for a total GDP of $15.294 trillion (annualized). This is a 6-quarter high, the highest since Q2 2010 (+3.8%). The GDP has increased for 10 consecutive quarters, since Q3 2009, although growth rates have ranged from a near-abysmal +0.4% in Q1 2011 to an encouraging +3.9% in Q1 2010. There will be second and third estimates announced in February and March, respectively.


Where is the USA Economy Going? The Big Question: where is the USA economy headed? Three scenarios are usually discussed: 1) a double dip recession whereby the GDP will turn negative yet again with a higher unemployment rate, 2) the economy will continue "bottom bouncing" with slow to very slow growth and a continuing relatively high unemployment rate, or 3) the bottom is in and GDP growth will accelerate and the unemployment rate will begin to decrease. Scenario 2) with slow to very slow economic growth and a continuing relatively high unemployment rate appears to be the most likely scenario for 2012, with an annual GDP growth projected of approximately +2.0% or less. The average of the 4 quarters reported by the Bureau of Economic Analysis in 2011 is +1.58% (Q1 +0.4%, Q2 +1.3%, Q3 +1.8%, Q4 +2.8%).

USA Real GDP % by Quarter (seasonally adjusted at annual rate) A negative drop into the Great Recession began Q3 2008, followed by a plunge in Q4 2008. The Great Recession continued for 4 quarters until Q2 2009. Positive GDP growth resumed in Q3 2009, the rebound peaking in Q1 2010 at +3.9%, and has continued for 10 consecutive quarters.

 


USA Real GDP $ by Quarter (seasonally adjusted at annual rate) The USA GDP pre-recession peak was Q2 2008 and the Great Recession low was Q2 2009. USA GDP has now increased 10 consecutive quarters. The Q4 2011 GDP (annualized) exceeds both Q2 2008 ($14.416 trillion) pre-recession peak and the prior Q3 2011 peak ($15.176 trillion) to reach an all-time high of $15.294 trillion.

 

Commentary The Q4 2011 USA Quarterly GDP (advance estimate) of +2.8% is a 6-quarter high and encouraging, even though below expectations. Our bearish estimate of the USA Quarterly GDP QoQ for Q4 2011 was +2.25% or less. We now raise our estimate to a still bearish +2.50% or less and expect the BEA advance estimate to be lowered. A recession in 2012 does not appear probable, but continues as a low risk.

=> For Additional Detail and Coverage, Visit OspreyFlyer.com <=

IMF: Global Economic Recovery Stalls, Downside Risks Intensify

=> For Latest Updates, Visit OspreyFlyer.com <=


International Monetary Fund: World Economic Outlook


International Monetary Fund (January 24, 2012) The global recovery is threatened by intensifying strains in the euro area and fragilities elsewhere. Financial conditions have deteriorated, growth prospects have dimmed, and downside risks have escalated. Global output is projected to expand by 3% percent in 2012 — a downward revision of about 3/4% percentage point relative to the September 2011 World Economic Outlook (WEO). This is largely because the euro area economy is now expected to go into a mild recession in 2012 as a result of the rise in sovereign yields, the effects of bank deleveraging on the real economy, and the impact of additional fiscal consolidation. Growth in emerging and developing economies is also expected to slow because of the worsening external environment and a weakening of internal demand.

Key Points:
■ Global recovery expected to stall, risks to intensify
■ Euro area expected to fall into mild recession, rest of world to slow
■ Comprehensive package needed to restore financial stability
■ Countries should avoid too rapid tightening of fiscal policy
■ Europe is epicenter, key to restoring confidence
■ Asia still strong
■ Financial sector risks rise
■ Progress on sovereign fiscal side

Actual and Projected GDPs by Year: World, USA, UK, Japan, Euro Area





Actual and Projected GDPs by Year: China, India, Brazil, World, Russia





Actual and Projected GDPs by Year: Developing Economies, World, Advanced Economies





IMF Marks Down Global Forecast, Sees Risk on Rise With intensifying strains in the euro area weighing on the global outlook, the International Monetary Fund has sharply cut its forecast for world growth this year. Speaker: Olivier Blanchard, Economic Counsellor, IMF.



=> For Additional Detail and Coverage, Visit OspreyFlyer.com <=