An update to this chart which has appeared here quite a few times in the past. Layoff announcements by corporations have fallen dramatically over the course of this year, providing strong evidence that the recession has run its course.
The Challenger report doesn't seem to get much airplay or really tally with what other employment data series seem to tell us. What are its strengths/weaknesses as an indicator?
Strengths: it seems to do a good job tracking big swings in the economy, and may be a more coincident indicator than the employment or claims numbers.
Weaknesses: we can't be sure the Challenger people have followed a strict methodology in their tally of layoffs. Where do they get the info? Also, their data might not reflect the changing composition of the workforce. If large companies are shrinking, then this indicator becomes less meaningful.
Anecdotally, I work for a very large corporation and I can tell you we are hiring like crazy after laying off almost half the staff from the end of last yr through a couple months ago. Our volumes have increased alot after plummeting off a cliff.
I don't see any inconsistency in these facts. This is not going to be a rip-snorting recovery, and it is going to take time for jobs to pick up. Meanwhile, some people and some companies are going to do much better, while others are going to struggle. Some are finding plenty of cheap credit, while others are having trouble. I think you should expect these things during a transition from a very weak economy to an economy that slowly gets back on its feet. The trend remains up, that is the thing to focus on.
The Challenger report doesn't seem to get much airplay or really tally with what other employment data series seem to tell us. What are its strengths/weaknesses as an indicator?
ReplyDeleteStrengths: it seems to do a good job tracking big swings in the economy, and may be a more coincident indicator than the employment or claims numbers.
ReplyDeleteWeaknesses: we can't be sure the Challenger people have followed a strict methodology in their tally of layoffs. Where do they get the info? Also, their data might not reflect the changing composition of the workforce. If large companies are shrinking, then this indicator becomes less meaningful.
This cartoon kind of reminds me of your views :)
ReplyDelete"First it was bad and then it was horrible, but now it's just awful"
http://1.bp.blogspot.com/_pMscxxELHEg/Sp2PHzYezEI/AAAAAAAAGRg/leqrPtoWC38/s1600-h/just+awful.bmp
As a graduating grad student, I can tell you what else has all but vanished: Corporate hirings. Recession over =/= recovery.
ReplyDeleteAnecdotally, I work for a very large corporation and I can tell you we are hiring like crazy after laying off almost half the staff from the end of last yr through a couple months ago. Our volumes have increased alot after plummeting off a cliff.
ReplyDeleteI don't see any inconsistency in these facts. This is not going to be a rip-snorting recovery, and it is going to take time for jobs to pick up. Meanwhile, some people and some companies are going to do much better, while others are going to struggle. Some are finding plenty of cheap credit, while others are having trouble. I think you should expect these things during a transition from a very weak economy to an economy that slowly gets back on its feet. The trend remains up, that is the thing to focus on.
ReplyDeleteGold is @ 980 and the 10YR is 3.3% while equities have been flat to lower.
ReplyDeleteWhat's your take?
I think the answer to this requires a post with charts and commentary.
ReplyDelete