You may have seen reports yesterday from the Commerce Department that the Commerce Department followed up with disappointing news, noting that personal incomes fell 0.1% in September after rising 0.4% in August.
Today, the Free Exchange blog, written by The Economist reporters, looks at what's behind those numbers:
And so what we're seeing is the first big bulge of jobless workers exhausting their benefits. Over the next few months, that bulge will become a wave. Things will become significantly worse next month when existing benefits expire. By April, nearly 4 million jobless Americans will have run out of benefits. ...
[Some will welcome] the disappearance of a major disincentive to find new work has vanished, and so employment should rise rapidly between now and the spring. If all of the newly benefit-less workers find new jobs, the unemployment rate will drop a good two percentage points.
The problem, of course, is that firms are still very reluctant to hire amid weak demand. The ratio of jobless workers to job openings remains quite high.
Read the full entry: The 99ers.
