Patience, South Carolina - Recovery Is Coming

These Signs Aren't Up All Over Yet, But More Will Be Soon ...

Like we always say, we are here to temper your unjustified enthusiasm, and to pick you up when you're ready to jump off the Ravenel Bridge .... As the Yin to your Economic Yang (?), we just got the news about the Palmetto State's unemployment rate once again rising in November to an all-time high of 12.3% ... It sounds really, really bad, but there are plenty of nuggets from here and elsewhere to give you rays of hope that the worst is over. I know I've said this before, but this is a long, dragging recession - even longer than we thought. Here's the hope:

1. The Good Side of 12.3%

No, I haven't lost my mind. Even when the rate goes up, there can be signs that better times are ahead. The main number? The number of employed people actually went up. The reason for the rate increase was that the number of job seekers went up by slightly more. That means that people who had given up on looking for work are getting back into the mix - and some are being hired...

2. It's Frigging November

Ahhh, the big November hiring blitz... Doesn't sound familiar, does it? It shouldn't. Companies, even many in retail, don't hire people until December, but the big hiring in manufacturing and other big businesses starts in January. Inventories are way down, and they have to restock at some point. They re-evaluate everything on January 1, then decide if they can hire - and many will hire a few.

3. Leading Economic Indicators

I'm surprised the spin doctors in the Obama Administration haven't used this stat more, but the leading economic indicators for consumers have actually risen for EIGHT STRAIGHT MONTHS. Granted, when you're in the basement, you can only go up, but maybe they've skipped it because it might show that the Stimulus, which started well after that, has had little effect on the economy - and why another one is wreckless. Check Mate...

4. You Are South Carolina

Don't take this the wrong way, but DC does not care about you. Your paranoia is somewhat justified. They view SC as something in the way when they're going to Florida. Barack Obama has only seen it from a plane as President. All that aside, there is an economic principle to describe this: Economic Recovery is much like inventory use: LIFO-last in, first out, FIFO-first in, first out, LILO-last in, last out, and FILO-first in, last out. South Carolina is a FILO..... The economy is smaller, more apt to downturns, and slower getting out. We are always the last to see good times, and the first to see bad times. The good news is that better times are starting to emerge elsewhere.... Here in Long Island, the unemployemnt rate just dropped .4%, from 7.2 to 6.8% - and we still manage to complain. Statewide , it is also dropping, from 9.0 to 8.6%. The Big Boys always recover first, then the little brothers (or Red-Headed Stepkids) get the last of the table scraps....




Now, the caveat: If any of you think that we are heading for a slam-dunk 2010, don't count on it. This recovery will be slow and not very robust. The numbers will not be great. South Carolina will be damned lucky to be out of double-digit unemployment by year's end. In fact, I have a buddy who is pretty smart - and rarely wrong - and he sees 10% out of work nationally as the norm from now on. Businesses are doing more with less - but they will need some more..... Chin Up!



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