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By Jason Stipp | 08-07-2009 11:04 AM

Back to Work: The Underpinnings of Employment Recovery

Our take on the factors that will drive job creation and Friday's better-than-expected employment data.

Jason Stipp: I'm Jason Stipp for Morningstar. The government released its employment data numbers this morning, and it was a surprise to the upside: Unemployment actually ticked down a little bit to 9.4 percent, but 247, 000 jobs were lost in July. The number seems high, but it was actually a lot fewer jobs than most market watchers were expecting.

Here with me to talk about some of the data is Bob Johnson, Morningstar's associate director of economic analysis, and Vishnu Lekraj, an equity analyst covering the employment industry. Thanks for joining me, guys.

Vishnu Lekraj: Thanks.

Stipp: Yesterday we talked about some of your expectations for the job losses today, and you guys were both a little bit on the high side as were a lot of market watchers. The first question I have for you is what was the biggest surprising number that actually led to better results than a lot of people were expecting?

Bob Johnson: I think the number one better result was the manufacturing sector was a lot better than people had been anticipating. Typically, we've lost well over 100, 000 jobs every month, month in and month out, for the past four or five months.

This month we were down into the double-digit thousands. We were more in the 50, 000-60, 000 range, so that was the biggest surprise in the number. That was the best number that was there.

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