The Obama campaign must have been secretly relieved when rumors surfaced that Sandy might delay the release some of the employment numbers. But, the delay seems to have been just a rumor as a bevy of economic data was released today.
The number of planned layoffs by U.S. firms jumped 41.1 percent in October to the highest level in five months, according to a report by Challenger, Gray, and Christmas.
Perhaps business owners are looking down the barrel of Taxmaggedon coming at the beginning of next year. In defense of President Obama, the number includes is driven by job cuts in the automotive sector. According to the press release:
“The automotive sector led the surge in October job cuts, announcing plans to shed 11,615 workers. The October total is more than the 10,405 job cuts announced by this sector over the previous nine months. The new year-to-date-total of 22,020 is more than double the 10,593 job cuts announced by the automotive sector in all of 2011.”
Oh. Wait. That actually doesn’t help the president either since a key talking point of his campaign is the success of the auto bailout. John Challenger, chief executive officer of Challenger, Gray & Christmas, said of the report: “the last three months of the year tend to see heavier lay-off activity and the weak third-quarter earnings season does not bode well.” The number was up 12 percent from the same month a year ago, when employers announced plans to trim payrolls by 42,759 workers.
One of the more interesting pieces of information coming out of this press release is the “announced hiring plans – monthly totals”. In September 2012, the monthly announced hiring was a whopping 425,683 hires, which was attributed to seasonal part-time work. This is great, right? Well, maybe. To put it in perspective, in September 2011, the announced hires (again, attributed to seasonal hires) was 76,551. Do seasonal employers really think that they will need five times the number of seasonal employees as they did last year? Particularly in light of the weak third-quarter earnings?
To add to the questions; however, the yearly totals of planned hires in September 2012 (585,685) is already above the total in 2011 (537,572). But, this only can be attributed to the September 2012 planned hires outlier of 425,000 new jobs. If the last four months of 2012 planned new hires are flat with 2011, for the year, we would be down almost 140,000 jobs for the year.
Here is what Challenger, Gray & Christmas had to say about the anomaly:
“We only track hiring plans that are announced. Last year, for instance, we didn’t record large hiring announcements for GameStop, Party City, or Amazon. It’s possible that companies didn’t announce, didn’t hire a large number of seasonal workers, or we just missed the announcements in our monthly tracking. It’s also possible that companies announced all at once because of increased media attention on the subject. In any event, we did see a spate of announcements in September for holiday hiring that we didn’t see last year.”
In other economic news, this morning, ADP released its September jobs numbers and the numbers are in sharp contrast to earlier findings. ADP has revised the way it calculates jobs numbers, and this new method shows that the U.S. economy added just 88,200 jobs in September, not the 162,000 originally reported. The revised number is also below the Labor department’s September job creation household survey total of 114,000.
CNBC reported on the change in methodology, saying: “It’s huge, no doubt about it,” said Todd Schoenberger, managing principal at the BlackBay Group in New York. “Their changing the methodology tells me that if the number is cut in half with that revision, then the revision we’re going to see Friday is going to be a disaster.”
While economists sort out other economic data following Superstorm Sandy, these two tidbits surely must be disappointing for the Obama campaign.