Employment Creation Commission Coming Soon

It was supposed to be released on October 4, but the partial government shutdown delayed it. It was refreshing having a payrolls Tuesday instead of a payrolls Friday. What wasnt refreshing was the 148,000 payrolls number. That was significantly below my expectation of 170,000. However, Augusts number was revised up to 192,000. There was little change in the number of long-term unemployed (27 weeks or longer) or the labor force participation rate. The Federal Reserve (Fed) is somewhat vindicated in its decision not to start tapering in September. What effect will the partial government shutdown have on the October report, to be released in November? It will probably be a little, but not a lot. The key is timing. Payroll numbers for the report are calculated for the pay period that includes the 12th of the month. Businesses may have delayed hiring in anticipation of budget problems out of D.C. Their fears proved to be well founded. Given that the shutdown ended on October 17, its likely that the October report will show private payrolls that are somewhat depressed. That should not be seen as a change in the upward trend of the economy, though. There was probably a pickup in hiring after the shutdown ended. What about the federal payrolls number? Federal employees have a pay-period calendar published by the General Services Administration, and that pay period in October runs from the 6th to the 19th. Given that the partial government shutdown ended on October 17, federal employees furloughed should be counted. However, they will only have three days of pay counted. They will get retroactive pay, but it doesnt count when calculating wages for the employment situation report. As a result, while the payrolls number shouldnt be affected, the number of hours worked will be. The key takeaway is that the October reportat least as it relates to the number of people on the payrollsshouldnt be distorted too much by the furlough, though it will likely understate the strength of the economy. The Fed will likely err on the side of caution and wait to see what the November and December numbers look like before changing its policy of asset purchases. That should keep ample liquidity flowing through the economy and the markets. The views expressed are as of 10-22-13 and are those of Chief Portfolio Strategist Brian Jacobsen, Ph.D., CFA, CFP, and Wells Fargo Wells Fargo Funds Management , LLC. The information and statistics in this report have been obtained from sources we believe to be reliable but are not guaranteed by us to be accurate or complete. Any and all earnings, projections, and estimates assume certain conditions and industry developments, which are subject to change. The opinions stated are those of the author and are not intended to be used as investment advice.

The planned commission will be tasked with research, analysis and coordination of policies and programmes focussed on employment creation, including the implementation of the National Employment Policy. President Hifikepunye Pohamba revealed this yesterday when he launched Namibias 2013 National Employment Policy during the two-day National Employment Conference in Windhoek. In order to succeed, we must as a matter of urgency, take practical steps to reduce the high levels of poverty, inequality and unemployment, while ensuring industrial peace and harmony in all sectors of the economy, he said at the event. The new National Employment Policy was formulated to facilitate the implementation of specific interventions to achieve the objectives of Namibias 4th National Development Plan (NDP4) and Vision 2030. The policy is linked to the countrys industrial policy, which is aimed at strengthening and mainstreaming the employment creation dimension of the identified priority economic sectors under NDP4. The policy is a product of extensive consultations between the Ministry of Labour and Social Welfare and various other role players. Its overall goal is to promote full, productive and decent employment that will eradicate poverty and reduce income inequalities, Pohamba said. The policy also focusses on key areas for job creation, namely modernization of the agricultural sector and food production; systematic and targeted value addition; renewable energy generation and green jobs, housing and sanitation, tourism, as well as small and medium size enterprise development and the transformation of the informal economy. I believe that the objectives of this policy will only be achieved when all role players take ownership of and implement the policy in a structured and co-ordinated manner. I call upon the Ministry of Labour and Social Welfare to provide policy direction and coordination, as the custodian and secretariat for the implementation of the employment policy, he said. Pohamba added that the recently announced Mass Housing Scheme under which 185 000 houses are supposed to be build during the next five years, has huge potential for job creation. He therefore urged the Ministry of Regional and Local Government, Housing and Rural Development, as well as the National Housing Enterprise (NHE) and other stakeholders to incorporate the training of unskilled workers, particularly women and youth, in the implementation of the ambitious scheme. The 2012 Labour Force Survey indicated Namibias national unemployment rate is 27.4 percent, while unemployment amongst youths aged 20 to 24 stands at 48.5 percent. In all age groups, the percentage of unemployed women is higher than that of men, which the president noted as a serious concern. While welcoming delegates to the national conference, Labour and Social Welfare Minister, Doreen Sioka said: Employment is the pulse of the national economy. Unemployment is a disease that both the public and private sector must fight. Also speaking at the opening of the conference, the Director of the International Labour Organisations Pretoria Office, Vic van Vuuren, noted that there are about 250 million unemployed people in the world, of which about 75 million are young people. Van Vuuren continued that social dialogue needs to be inclusive, beyond the employment arena and that countries that have impacted unemployment in a meaningful way have taken bold but necessary steps.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s