Job losses not unexpected

The big job loss in December was not unexpected. The good news is that this big bad number will help to solidify the case for a big stimulus bill in the next few weeks.

My expectation is that job losses will continue for some number of months, even after the stimulus causes spending and incomes to spike up and boost GDP.

One caveat: The employment report is based on surverys as of the week of the 12th of the month. So, job cuts in the second half of December will not be counted until the next report comes out in early February.

I still believe that the worst is probably behind us. The worst part of the financial panic is over. Much of the knee-jerk slashing of jobs probably culminated in December. January will probably still be a fairly bad month for jobs, but not as bad as December. February will likely follow that same pattern of smaller losses. Then, we will be seeing the effects of stimulus on an incremental basis in March.

-- Jack Krupansky