How high will the unemployment rate go in 2009?

Unemployment at 9.4% in May up from 8.9% in April and 8.4% in March- that is an increase of between 0.4% and 0.5% per month. There are 7 months till the end of the year. If it continues at trend that could mean another 2.8% to 3.5% rise which will take it to between 12.3% and 12.9%. You need the economy to grow at around 2% to stop unemployment falling and that is not going to happen any time soon.

The government and the Fed are either clueless or hoping that if they continue to be positive that this will boost consumer confidence and turn the situation around. Either way they have underestimated the rate of job losses badly. In January they predicted the rate at the end of the year would be 8.7%. They subsequently raised that to 9.5% with the prediction that unemployment will not stop rising until some time in 2010.

So lets do the maths.

If you are punting on a rate of 9.9% or below then that gives you 0.5% leeway in 7 months. For that to happen we need some form of miracle of less than a 0.071% increase per month.

If you choose the option of a maximum of 10.9% that means you can't average more than 0.21% per month.

The government is fudging the numbers and presenting them dishonestly to try and spin their way out of the situation.

To quote the bureau of Labour statistics web site - "Nonfarm payroll employment fell by 345,000 in May, about half the average monthly decline for the prior 6 months. The unemployment rate continued to rise, increasing from 8.9 to 9.4 percent."

Ask yourself the question - if employment fell at half the rate of April when unemployment rose by 0.4% how is it that is rose by 0.5% in May when the unemployment numbers halved?

Is Obama Getting a Pass on the Bad Economy?
http://www.timeswatch.org/articles/2009/20090606074358.aspx
Double standard? Today's 9.4% unemployment rate "fueled hopes" that the economy was recovering, but 4.6% unemployment rates during the Bush administration were characterized as "job growth slowing to a crawl."
Posted by: Clay Waters
6/6/2009 7:57:07 AM
As the economy continues to shed jobs, is the Obama administration getting a pass? The front-page story Saturday by Peter Goodman and Jack Healy came under the relatively cheery headline "Hints of Hope in Jobless Data Even as Rate Jumps to 9.4%."

* * *

The May 9 story by the same team also did its best to find the bright spots in the April unemployment figures -- "U.S. Jobless Rate Hits 8.9%, but Pace Eases."

* * *

The tone was more mordant in Goodman and Healy's April story reviewing the previous month's unemployment rate, which included a prediction by the Obama administration that if their massive stimulus package wasn't passed, the unemployment rate could reach....8.9% by the end of 2009!

Of course, the package passed but the unemployment figure reached the pessimistic 8.9% figure in April anyway, and far surpassed it in May. Why didn't the Times didn't mention it in its unemployment stories for those months?

* * *

Contrast the relatively sunny tone of the Obama reports with the negative tone that greeted far better employment numbers during the Bush administration, when the unemployment rate was well below 5%.

Eduardo Porter in October 2006 marked a 4.6% unemployment rate under the headline "Job Growth Was Slack Last Month." Porter wrote, a month before congressional elections:

* * *

Yet three years later, a jump in the unemployment rate to 9.4% is grounds for optimism. What changed? Besides a liberal Democrat being in the White House, of course.

[Read the whole article at the link]

Notable, It's called the "honeymoon period"...
And that he has had lots of simultaneous problems not of his making...
(guess who made them?)
do you need a hint?
I grant that you have valid points you made though...

Georgia, Alabama Top 10% Unemployment as Firings Gain http://www.bloomberg.com/apps/news?pid=20601103&sid=atgxkKrnE2hI
North Carolina unemployment ticks back to 11% http://www.bizjournals.com/charlotte/stories/2009/07/13/daily50.html
June's California unemployment rate: 11.6% http://www.latimes.com/business/la-fi-caljobs18-2009jul18,0,6076386.story
C. Fla. unemployment hits 10.8% http://www.bizjournals.com/orlando/stories/2009/07/13/daily43.html

From http://www.bloomberg.com/apps/news?pid=20601087&sid=aNaqecavD9ek

U.S. unemployment will surge to 10 percent this year and the budget deficit will widen to $1.5 trillion next year, reflecting a “deeper recession” than previously expected, White House budget chief Peter Orszag said.

The Office of Management and Budget also forecasts that the U.S. economy will shrink 2.8 percent this year, worse than the 1.2 percent contraction the OMB projected in May. For next year, the budget office said the gross domestic product will grow 2.0 percent, less than the 3.2 percent expected in May. By 2011, the economy would be well on its way to recovery, growing at a 3.8 percent annual rate, according to the administration’s mid-year economic review, released this morning.

The budget shortfall for 2010 will mark the second straight year of trillion-dollar deficits. The projected deficit for the fiscal year that begins Oct. 1 is higher than the $1.26 trillion forecast in May and reflects expectations economic growth will be slower this year and next because of “the severity of the crisis in the U.S. and in our trading partners,” said Christina Romer, White House chief economist, who along with Orszag briefed reporters on the report.

The deficit and unemployment numbers may weigh down President Barack Obama’s drive for his top domestic priority, overhauling the U.S. health care system.
[More at the link...]

I'm in the 10-10.9 bracket and I'm getting nervous! It might even shoot over.

I don't see any companies hiring for the next 2 years but I see plenty of shedding. Unemployment in the US might hit 12.5% even with the govt fudging the numbers. I went to the States 3 times over '99-'00 and even then you could see this coming. Tramps and hobos everywhere while at 2pm on a Wed afternoon the streets were filled with people in shorts and T-shirts wandering around drinking Sloppy Joe's. "Don't these people work at all?" was the only thought that kept crossing my mind over and over. Here in Japan all you see is briefcases and suits, engineers uniforms and office ladies. All rushing about doing business. "And if THEY'RE in trouble what the hell is gonna happen to the US??" Well, that was California then. Now we see the results.

9.8

11% in Florida