As I was combing through the Bureau of Labor Statistics job report for July, I couldn't help but to begin adding up the hundreds of thousands of potential job losses caused by Hurricane Katrina. I'll get to that in a minute, but first let us break down the 207,000 jobs created in July. I think you'll see a lot of manure in the numbers.
207,000 New Jobs
50,000 Jobs in Retail: How many of these jobs were students seeking summer employment, and how many retail jobs are going to be lost in the hurricane damaged area's.
26,000 Tax Supported Government Jobs: With who ? FEMA and Homeland Security?
30,000 Jobs for Bartenders and Food Servers: Again, many of these are summer jobs, and many of these jobs have disappeared in and around New Orleans with the hurricane.
28,000 Jobs in Healthcare and Social Work: The Healthcare Industry is fast becoming the largest employer in the nation now that we have shipped many of our manufacturing jobs overseas. We are going to need Social Workers to talk with to keep from going nuts after paying sky high prices for healthcare, and any goods and services that have increased due to high energy prices.
12,000 Real Estate Jobs: Low interest rates aside, I'm confident that waterfront condo speculation will begin to fall off a cliff after Hurricane Katrina. If not, the Forest Gump expression of "Stupid is as stupid does" will apply.
8,000 Jobs for Transit Service Workers
8,000 Jobs for Wholesale Workers
7,000 Jobs in Construction: Employment in this field should continue to climb. In our area, we are seeing a massive number of Mexican workers being hired by contractors.
6,000 Jobs in Credit Card Services:
So, at first glance, 175,000 of the 207,000 jobs created (or 85%)are in the service sector. If you subtract the number of Services Jobs from the total jobs created, you can reasonably assume that 32,000 jobs were created in area's that produce a tradable commodity. So much for fixing the massive trade deficit.
When you subtract the potential job losses from Katrina from the 207,000 jobs created, one can easily come to the conclusion that the jobs reports in the future are not going to paint a pretty picture.
The US economy was already inching toward a slowdown, and now that many along the Gulf Coast will be unemployed for the foreseeable future, the US may begin accelerating toward a recession instead of inching toward one.
