Friday’s employment report--its headline grabbing numbers notwithstanding--turned out to be anticlimactic in a week which saw a new negative assessment of the economy in the Beige Book and dismal numbers in unemployment claims suggesting next month’s labor data won’t be much better.

But, we’re getting ahead of ourselves….

Wall Street seemed to defy the conventional advice: “buy on the rumor, sell on the news,” with a huge drop in stock prices Thursday, in advance of the employment report and a ho-hum performance Friday when the actual numbers turned out to be worse than the most dire forecasts.

A quick recap:

The month-to-month decrease in payroll jobs for August was the eighth in a row, the first time jobs have fallen for eight straight months since 2001-02. Payroll employment dropped for 15 straight months from March 2001 through May 2002.
The civilian employment rate--measuring the number of people with jobs as a percentage of the working-age population--fell to 62.1%, the lowest level since October 2003.

The unemployment rate rose to its highest level since September 2003 and is up for 4.7% one year ago – the steepest year-year increase in the unemployment rate since the 12 months ended May 2002.

The number of people (16 years of age and older) unemployed (out of work and looking for a job) increased 592,000 in August, the fourth consecutive monthly increase. The number of unemployed women increased 483,000, or 81.5% of the total August increase. In the last year, unemployment is up 2,243,000--1,313,000 men (58.5%).

The final point provided a conundrum: why would the number of unemployed women jump so dramatically and disproportionately? One suggestion is the establishment survey--which tracks jobs, not workers--showed declines in administrative, office and temporary workers which, one could argue, are jobs more often held by women. 

But, data from the household survey--which tracks workers, not jobs--show the number of women in the labor force increased in August, so job losses would not necessarily account for the increase in the number of women counted as unemployed. Most likely, pressures on household budgets drew women back into the labor force looking for jobs, meeting the definition to be counted as unemployed--another sign of stress in the economy.

And there were others with the report Friday from the Mortgage Bankers Association that the percentage of mortgage borrowers delinquent on their loans increased to 6.41% in the second quarter, up from 6.35% in the first quarter. The increase came not from “subprime” borrowers but “prime" borrowers. Indeed, the delinquency rate on subprime loans improved slightly to 18.67% from 18.79%, while the delinquency rate for prime borrowers increased to 3.93% from 3.71%.

Additionally, the Spectrem Millionaire Investor Index dipped one point in August to -9, suggesting continued concern about the economy even at the high end. Spectrem’s companion Affluent Investor Index, which measures the investment outlook of households with $500,000 or more in investable assets, rose four points, but remained in negative territory at -13. The two indexes measure the attitudes and outlook of high end households.

The Spectrem Affluent Investor Index is based on 10-minute telephone interviews of 250 financial decision-makers in households with $500,000 or more in investable assets. The Spectrem Millionaire Investor Index(R) is a subset of the overall survey group that can vary each month, typically more than 100 monthly interviews.

The reports for the week set the stage for the possibility of more disappointing news in the week to come, particularly at the end of the week, when the Commerce Department reports on retail sales and Bureau of Labor Statistics provides wholesale inflation data. 

The retail sales report--representing about 40% of consumption spending--will help firm forecasts for third quarter GDP, the basic measure of the nation’s economy. The retail sales numbers were hinted with reports from major chains, but the Commerce report is more widespread and more influenced by earnings. According to Friday’s employment report, average weekly earnings rose slightly, but fewer people were working, thus affecting spending.

Mark Lieberman is the senior economist for the Fox Business Network. Prior to joining FOX, he served as first vice president and manager of economic analysis and research at Washington Mutual in New York. Before that, he served as senior vice president at Dime Savings Bank of New York (which was later acquired by Washington Mutual), where he specialized in credit and risk management. He is a member of the Executive Committee of the New York Association for Business Economics. He has a degree in Economics from the Wharton School of the University of Pennsylvania.