Friday, December 24, 2010

MAROONS IN ACTION: Spring 2011 Researchers

MAROONS IN ACTION: Spring 2011 Researchers: "Several students will participate in undergraduate research experiences with Dr. Alice Louise Kassens covering a wide range of topics during..."

Thursday, December 23, 2010

Happy Holidays and New Year from RC Economics

The Economics Program wishes you and your families a happy holiday season and a wonderful new year.  Remember to update us with what is new with you and give us your contact information so that you can get the first issue of Roanomics!  Use the tabs above to give us your information.

Tuesday, December 7, 2010

New unemployment poll

A new poll was just started on this blog concerning the unemployment numbers to be released January 7, 2011.  The Employment Situation Report was released last Friday showing the unemployment rate for November.  It increased from 9.6% to 9.8%. 

We hosted a non-scientific poll asking respondents their projections for the November number in the weeks leading up to  the December 3 release data.  The question, possible answers, and results were as follows:

What do you think the unemployment rate will be for November 2010?
9.6% (unchanged)  12 (50%)
greater than 9.6%   5 (20%)
less than 9.6%         7 (30%)

The actual number for November was 9.8%, up from 9.6%.  Many experts believed that the number would actually fall to 9.4-9.5%, and were obviously wrong.  20% of voters in our poll were right, voting for a number greater than 9.6%.

For the next several months this blog will host similar polls (the one for the December number was just opened).  Results of the polls through March will be compared to the actual numbers in the March 2010 issue of Roanomics.

Make sure you enter your vote!  See how well you can predict one of the more popular economic indicators.

Monday, December 6, 2010

And the winner is...

We have selected the winning title for RC Economics Program newsletter.  As many of you know, we held a Newsletter Title Contest (entries could be made on this blog.)  We had over 50 submissions. 

Two young ladies submitted the same winning entry, so we actually gave out two first place prizes. 

Meghan Sacco and Katie d'Esterhazy both submitted "Roanomics" and won $25 gift cards to Mill Mountain Coffee and Tea. 

The runner-up was so close and so good that we also awarded a $10 gift card for it.  Laura Landis submitted "On Demand" for the runner-up prize.

Thanks to all who participated.  Remember that if you would like to receive Roanomics, our electronic newsletter, please go to the "Contact Information" tab and fill in your information.

The Volume 1, Issue 1 will be sent out March 2011.

Friday, December 3, 2010

November unemployment rate

On the first Friday of every month at 8:30 AM labor economists, like me, get very excited.  The BLS's Employment Situation report is released.  Amongst other statistics, the unemployment rate for the previous month is reported. 

This morning it just so happened that I was in the middle of my Block 1 Principles of Microeconomics class teaching about labor markets and unemployment.  The students were kind enough to indulge me with an apparent interest as I pulled up the BLS web page (http://www.bls.gov/) to see the new number.  The headline read...

Unemployment rate (9.8%) edges up in November; payroll employment changes little (+39,000)


Not good news.

The unemployment rate was holding steady over the past few months at 9.6%.  Employment must increase by about 150,000  per month just to hold the unemployment rate steady.  Clearly the 39,000 increase was not enough and the unemployment rate increased.

Before major conclusions are drawn, we must dig a little deeper.  An individual is considered unemployed if they are not working for pay AND are actively seeking work.  If someone becomes "discouraged" and stops looking for a job, they move from the ranks of the unemployed to another category: not in the labor force.  As the economy improves and job opportunities appear, theses discouraged workers start looking again.  Once they start looking they move into the labor force and are considered unemployed.  This can cause a temporary uptick in the unemployment numbers.  The broader ranges of unemployment actually suggest that more people are becoming discouraged and not looking than less.  Yikes!

While it is expected that unemployment will rise as discouraged workers reenter the workforce, there were other concerning signs in the report.  Average weekly hours worked remained unchanged between October and November (34.3 hours).  Typically before firms start hiring more people, they work their current workers harder until the employers are comfortable that the downturn is over. Hours worked had been slowly rising until this month. 

How long will it take to recoup all of the lost jobs since the beginning of the 2007 recession?  One report estimated that would happen...by 2017 !  That was conditional on several factors, including GDP growing at an average of 2% per year.  If the actual growth rate is lower and/or employment continues add on low numbers like in November, we could be waiting even longer.

This blog hosted an non-scientific poll concerning projections for the November unemployment rate.  20% of participants felt that the unemployment rate would rise for November.  Most felt that it would remain at 9.6%, where it has been for several months (including this labor economist).  A lot of people were wrong, not just poll participants from this blog.  Many experts thought that unemployment would actually fall.

As we move into 2011 there are a lot of unanswered questions, uncertainty, and even fear.  Here's to a more stable and certain economy for the new year.  Hopefully on the first Friday of 2011 the Employment Situation Report is a little bit rosier.