Another disappointing jobs number-brief analysis

Before getting into the jobs number, lets take a quick look at gold. As someone who spends a significant portion of his life watching the gold futures ladder, I must say, my life is rather boring. To be fair, on a day to day basis, we have seen some pretty significant moves. One day we will be up 30 bucks, the next down the same. Last jobs report we moved over fifty dollars. Today, gold spiked 10 dollars after the disappointing jobs report was released, only to give back the gains. It is as if there is a rule that come Friday, no matter what has transpired during the week, gold needs to settle somewhere near 1590.

Turning to the employment report. A somewhat disappointing 80,000 non-farm jobs were added in the month of June. The unemployment rate remains consistent at  8.2%, while average hourly earnings ticked up, as did average hours worked per week (from 34.4 to 34.5). A mere tenth of an hour (or 6 minutes for those who don't like to do decimals of hours) probably does not seem like much, but we should at least consider its meaning. If there are approximately 100 million people in the workforce, and the number of hours worked by already-employed people increases by approximately .3% (.1/34.5) then effectively 300,000 or so jobs become unneeded. To do the simple math, .3% of 100 million is 300,000, could you imagine if you just took the time in hours added per work-week and turned them into jobs?

Yes it is true, the world does not work like that. If adding to the workload of existing workers instead of hiring is the choice of employers, than things will be better for a few, but worse for many. I do not want to try to draw too many conclusions from these reports, but I think it is important to focus on hours worked far more than we tend to.

All the best,

Ben