September Employment Fell Again and by More than in August

Non-farm employment fell by 263,000 in September.  This was a greater tumble than that in August by 62,000 people.  The acknowledged unemployment rate is up to 9.8%, which is somewhat higher than the 8.0% maximum Obama promised us if he and the Democrat Congress were allowed to pass the Stimulus Bill.  Perhaps he forgot to calculate the fact that most of the money would not even be spent until 2010 and that spending large amounts of money on non-productive government programs is hardly the way to encourage businesses to hire.  Some businessmen understand that larger government means more government mischief interfering with the private sector.

The Bureau of Labor Statistics reports that the U.S. economy lost 824,000 more jobs in the first quarter of this year than they had earlier reported!  This recession has therefore cost Americans 8 million jobs and 5.8% more of the workforce is unemployed now than was at the start of the recession.  The worst previous loss of jobs since WWII was in 1948 when unemployment rose 5.0%.

CFO Magazine reported that a September survey they did with Duke University found that half of the businesses polled did not expect to return to their pre-recession employment levels until 2012, if then.  43% of company CFOs plan to further reduce their payrolls in the next 12 months.

Nancy Pelosi's talk of adding a value added tax (VAT) is hardly likely to encourage employers to hire again.  Of course the new taxes and regulations to accompany the Democrat health care insurance system will strongly discourage businesses from hiring.  So too will energy use restrictions and taxes in the form of cap and trade.  Ditto the end of the Bush tax cuts.  Ditto the ever-present anti-business rhetoric in the Democrat Congress and White House.  Ditto the on-going desire to make it impossible for employees to avoid being roped into a union.

The health insurance industry sure learned the consequences of trying to cooperate with this government.  They are bleeding profusely from a knife plunged deep in their backs.  Those companies who think they have come out well in the early round one period under the Waxman-Markey carbon cap and trade tax will soon feel the same knife in their backs.  Their subsidies will be revoked soon enough.

No, a wise businessman will be very wary about hiring in this political climate.  Every added employee is a further political liability.  Every employee will cost more than ever in health care benefits, unless they are dropped from health care benefits entirely.  If the employees are unionized, they are also a direct threat to company ownership and creditors.  Of course they were always that in that they made the company less productive and nimble, but now they are also a threat to investors and creditors should a company go bankrupt.  It is hardly surprising that rational businessmen are united in not wanting to hire and even in shedding still more employees.  Any employee who can reasonably be replaced with improved equipment will eagerly be replaced.  This mostly means lower paid workers.  These are the workers that the Democrats pretend to champion, but who their anti-business commitments are actually most hurting.