Tag Archives: gdp growth

February 2012 Unemployment 8.3%

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This morning, the Bureau of Labor Statistics released its report on the U.S. employment situation for February 2012, confirming the positive signs shown in ADP’s payroll figures released earlier this week.  As the chart below shows, while the unemployment rate stalled at 8.3% in February; 0.5% higher than January 2009 when President Obama was sworn in, but at the same as rate as his first full month in the presidency (February 2009) the economy added a significant number of jobs. (The chart is color coded red for months that President Bush was in office, and blue for President Obama).

In February, total nonfarm payroll increased by 227,000 jobs. Job growth was widespread throughout the entire private sector, with large increases in professional and business services (+82,000 jobs), health care and social assistance (+61,000 jobs), and manufacturing (+31,000 jobs). Government employment, however, continues to stagnate: in the past 12 months, the sector has lost 22,000 jobs.  Additionally, the change in total nonfarm payroll employment for December was revised from +203,000 to +223,000, and the change for January was revised from +243,000 to +284,000.
On the less positive front, the number of long-term unemployed (e.g., those who are unemployed for 27 weeks or longer) remained high in February at 5.4 million, accounting for 42.6% of the unemployed. However, that was down from 5.5 million in January.

In short, as with the recent upwardly revised numbers on GDP growth for the 4th quarter of 2010, the economy continues to trend in the right direction, nevertheless, it would appear that higher growth and more jobs are still needed to reverse the massive decline brought on by the Great Recession.

We would like to hear from you.  How does the employment situation look in your hometown?

 

Risky Business…Just How Exposed Are U.S. Banks to European Debt?

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The European debt crisis has been casting a shadow on the U.S. economic recovery for most of the past twelve months.   However, in spite of the hysteria in the popular press, the International Monetary Fund’s recent update to its World Economic Outlook left its prediction of 1.8% annual GDP growth for the US untouched while lowering their estimates for the Eurozone and economies with significant trade and financial ties to Europe.  One rationale for the IMF’s decision to leave the US estimate where it was in their September 2011 report was that the US is now more insulated from “financial and trade spillovers” from the euro area economy.  In this article, we use various infographics to show that in spite of the media fixation with Greece’s debt problems stalling the U.S. economy, banks in the United States have little  exposure in European countries other than the United Kingdom, France and Germany as the map below shows.

 

European Debt US Bank Risk

 

 

In those countries, the collective exposure for U.S. banks is about $1.5 trillion while the U.S. GDP is $15.3 trillion.  To put that another way, if things in Europe got so bad economically that Germany, France and the United Kingdom all defaulted on their debts to U.S. banks, the cumulative loss in GDP would be about 10% whereas the cumulative loss from the Great Recession was about 20 percent.  The chart below shows the relative risk for U.S. banks across all countries in Europe.

 

US Bank Exposure on European Debt