Well, the good news is that the unemployment rate fell to 9.7%. The bad news is that non farm payroll fell by 20,000, while analysts had forecast an increase of 5,000.

Unemployment falling is therefore entirely the result of people, most notably white women, having stopped looking for work, so I would not call it a good thing.

The fact is that long term unemployment, people who have been unemployed for more than 26 weeks,^* has hit 4.1% of the civilian workforce, an all time record.

Barry Ritholtz digs a bit deeper, and finds positive data points:

• The household survey shows an increase, and the household survey covers small business missed by the business survey.
• Temp employment increased, and temp hiring leads full time hiring, assuming that companies don’t go “permatemp”.
  • I would note that I have anecdotally observed this when I call “job shops” about contract work. Things to seem to be picking up, hence 2 interviews (1 in person and 1 phone) in the past 2 weeks, as versus 1 (phone) interview in the prior 6 months.
• Part-time for economic reasons (underemployed) fell sharply (3^rd graph from top)

As I noted yesterday, there was a big change in the “birth/death” adjustment, (bottom graph) and the adjustment appears to me to be more of an exercise in political number manipulation than a reasonably applied statistical technique.

In any case, if you scroll down on the full BLS report, they talk about the adjustment:

Table A presents revised total nonfarm employment data on a seasonally adjust-
ed basis for January through December 2009. The revised data for April 2009
forward incorporate the effect of applying the rate of change measured by the
sample to the new benchmark level, as well as updated net business birth/death
model adjustments and new seasonal adjustment factors. The November and
December 2009 revisions also reflect the routine incorporation of additional
sample receipts into the November final and December second preliminary
estimates. The total nonfarm employment level for March 2009 was revised down-
ward by 902,000 (930,000 on a seasonally adjusted basis), or 0.7 percent. The
previously published level for December 2009 was revised downward 1,390,000
(1,363,000 on a seasonally adjusted basis).

So they were off by over 1 million in December … Oopsie.

You can see Bloomberg’s interactive page on the effects here.

^*Full disclosure, this set includes yours truly, who has been out of work for about 30½ weeks.