A new report out from the BLS today reports that the unemployment rate fell from 9.5% in June to 9.4% in July.
As we've been covering here the weird situation with auto layoffs this year has played hell with the seasonal adjustment formula that the government uses to normalize numbers for regular seasonal ups and downs.
And when you look at the actual report (Table A-11) you can see that the there was no change in the nonadjusted unemployment rate, which held steady at 9.7%.
Further, any actual recovery would presumably involve a net rise in the number of employed. Yet even when we look at the seasonally adjusted employment numbers, we see that the number of employed actually fell from 140,196,000 in June to 140,041,000 in July. That's 155,000 less jobs month over month. Further the labor force itself actually shrank by 422,000 month over month. And the portion of the population not in the work force is growing. It's up 637,000 month over month. So simple population growth has added over 200,000 people to the pool of possible workers, but they ain't swimming.
There are reasons to be skeptical about the new unemployment numbers, and I'd suggest that celebration is a bit premature. It's likely that what we are looking at is the same statistical artifact that had been skewing the initial claims data for the past few months.