august JOLTS, the august trade deficit, & the september PPI

it was a fairly slow week around the economic blogosphere, with very few new economic releases…early in the week there was quite a bit of rehashing of the discordant numbers from last friday’s two employment surveys, but not much was uncovered that was new or particularly enlightening…Lee Adler at the wall street examiner did a fairly extensive deconstruction of how the seasonal adjustments influenced september’s report, which we looked at briefly here but never really sorted out completely, if you’re into the minutiae…and Bill McBride and Mish had a point-counterpoint series of posts on the labor force participation rate, which, even if it didnt resolve anything, did result in publication of a useful list of BLS definitions…and as if the BLS hadnt been under enough fire all week, on thursday they reported weekly unemployment claims at 339,000, which was widely reported as the lowest since 2008, only to later recant and note that california forgot to report 30,000 newly unemployed
Job Openings and Labor Turnover Survey
   there was one report out from the BLS, though, that seemed to be free of controversy and in line with their other ongoing statistics…the number of job openings noted by the Job Openings and Labor Turnover Summary for August  was reported as “essentially unchanged” from July’s report…noting that this report reflects labor stats on the last day of August, rather than the second week of september as the friday jobs report did, this report quantifies not only job openings but also the number of hires and job terminations, whether involuntary or voluntary, and further breaks down that data by industry and region…and for the job openings category, that unchanged was pretty much across the board; seasonally adjusted job openings fell from 3,593,000 in July to 3,561,000 in August, with only openings in accommodation and food services decreasing, while the change in the number of job openings all four regions was statistically insignificant…note that this says nothing about the quality of jobs open, nor whether they are full time…meanwhile, 4,390,000 workers were hired in August, up from July’s 4,278,000 hires, up 0.1% to a hiring rate of 3.3%, while 4,354,000 jobs terminated in August, also a rate of 3.3%, & up from july’s 4,088,000…job terminations are further separated into discharges, such as thru layoffs and firings, and quits, where the worker leaves the job of his own accord…bill mcbride graphs all this data monthly on one chart, with job openings charted in yellow, with job openings charted in yellow, hires in dark blue, with the two kinds of separations forning a bar graph, with quits as the light blue part of the column and layoffs & other discharges as a red column section above that…the difference between the hires and separations should roughly correspond to the payroll surveys 2 weeks later; its obvious from the chart that hires have exceeded separations most months over the past two years….while rising quits are widely read as an indication of an improving job market, it seems more likely in this recession to read many of them as those underemployed or temporary part timers just fed up with jobs they’ve found themselves stuck in that are obvious dead ends and walking away..

 U.S. Trade Deficit

on thursday, the Department of Commerce reported on our August trade balance in goods and services (48 pp pdf); reflective of the global slowdown, both exports and imports decreased as our trade deficit worsened to $44.2 billion in August from a revised figure of $42.5 billion for July, first reported as $42.0 billion….imports of $225.5 billion were only $0.2 billion less than July, while total August exports of $181.3 billion were $1.9 billion less than July exports of $183.2 billion; our goods deficit increased $1.5 billion from July to $59.3 billion, while exports of services increased $0.2 billion to $52.8 billion resulting in a services surplus of $15.1 billion, $0.3 billion less than July’s..the August figures show small trade surpluses with Hong Kong of $2.1 billion, with Australia of $1.8 billion, with Singapore of $0.9 billion, and with Egypt of $0.2 billion, while large deficits were recorded with China at $28.7 billion, the European Union at $11.7 billion, with OPEC at $8.1 billion, Japan at $6.7 billion, with Germany of $5.7 billion, with Mexico of $4.5 billion, and with Canada at $2.4 billion…the largest monthly import decreases were of consumer goods ($1.2 billion); auto & parts ($0.8 billion); and capital goods ($0.5 billion), while imports of industrial supplies ($1.5 billion); other goods ($0.2 billion); and foods, feeds, and beverages ($0.1 billion) increased; the decrease in exports reflected decreases in industrial supplies ($1.2 billion); foods, et al ($1.1 billion); and consumer goods ($0.4 billion); while increases were noted in capital goods ($0.4 billion) and other goods ($0.2 billion)..oil averaged $94.36 a barrel in August, up from $93.83 in July, but our imports of it declined from 275.1 million barrels to 273.9 million brl, so the cost of our net imports of it were little changed at $25.8 billion…bill mcbride’s 15 year chart, which shows the trade deficit for oil in black separated from the total trade deficit in blue to give a trade deficit ex-oil in red, is included above…we also showed a significant trade deficit in advanced technology products in august, as our high-tech imports of $32.3 billion eclipsed our exports of $25.5 billion, leaving us with a $6.7 billion advanced technology deficit; the commerce dept pdf has itemized lists of both imports & exports, with tables of actual dollar amounts of everything from soup to nuts & seasonally adjusted data for the same… 
Click to View

on Friday, the BLS released the Producer Price Index for September, which tracks price changes at the wholesale level…. driven by rising prices for gasoline, seasonally adjusted prices rose 1.1% in September after the increase of 1.7% in August, which had been the largest one month increase in over 3 yearsproducer prices are reported by the stage of processing that materials are at, ie, finished, intermediate and crude, but it is the finished wholesale goods, ready for final sale, that gets the most attention; the index for finished energy goods rose 4.7% in september after rising 6.4% in august; 80% of that price increase was attributed by BLS to gasoline, although prices for diesel fuel and residential natural gas also rose; wholesale food price inflation moderated to 0.2%, after a 0.9% increase in august; as dairy prices increased 2.8% over the month…less the food and energy index, core producer prices were statistically unchanged during september, as increases in items such as light trucks were offset by decreases in prices of computers and communication equipmentthe above chart, from doug short’s coverage, shows the year over year change in the overall (headline) PPI and the core PPI over the past dozen years, clearly showing the comparative volatility driven by wholesale food & energy prices…in the other indexes covered here, the prices of intermediate goods increased 1.5% in September, which was the biggest price jump since February 2011; intermediate energy prices were up 4.3% as diesel rose 9.2%intermediate food prices were up 2.0%, led by the drought related 5.1% increase in the price of animal feeds…and intermediate core prices rose 0.6% for the first time in 4 months, half of which was attributed to price increases for organic chemicals…and the price index for crude goods, which are raw materials entering processing for the first time, rose 2.8% in September after jumping 5.8% in August, as the price of crude oil rose 11.4% for the month…crude goods prices have now risen 10.7% in the third quarter, just about totally reversing their 10.8% price decline over the April to June period

(the above is my weekly commentary that accompanied my sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion, and also includes other links of interest…if you’d be interested in getting my weekly emailing of selected links that accompanies these commentaries, most coming from the aforementioned GGO posts, contact me…)

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