These two charts, via ContraryInvestor.com (subscription), show another side of the jobs equation. The first shows overall labor participation. The last 10 years have not been kind, and declines in the overall % of employed Americans have accelerated. Just wait till the baby boomers all retire on Social-Security and Medicare.

The historical data is interesting, especially the big jump during the 1960′s-80′s. Presumably this is due to the shift from one-worker to two-worker households, as more women entered the workplace.

The second chart shows the # of weeks the average person has been unemployed. Not pretty, as you can see. Eventually many of these people become discouraged, and are no longer counted as unemployed, as they are not “actively” looking for work.

labor-participation-rate

So while November’s “surprise upside” #s were less-bad, the employment situation is still ugly. And much of November’s relative rosiness was due to seasonal adjustments and temporary Holiday jobs.

Buckle up and be ready for a double-dip. It seems inevitable, to me at least. The real test comes if/when the Fed stops buying Freddie/Fannie debt Spring 2010, as they currently plan to.

I’m convinced the programs will be extended once it becomes clear just how dependent this “recovery” is on government printing. Once they announce the “unforseen” need for continued bailouts and printing, inflation expectations will rise.

My guess is that Bernanke/Geithner, et al, will feign shock when things turn south as the current programs expire. But do they seriously expect the real markets to be take over after ending a $1.25 trillion MBS crack-binge?