by Robert Maynard
After the August jobs report came out, one policy analyst conclude that we’re ‘dead in the water’. Here are a few highlights provided in this American Thinker article:
1. This was the jobs report that was supposed to reflect an economy kicking into higher gear. Goldman Sachs, for instance, was looking for 200,000 net new jobs. And whisper estimates were even higher. Instead, the economy added just 169,000 jobs vs. the 180,000 consensus forecast.
2. What’s more, June and July were revised down by 74,000 jobs, putting the three-month average at a paltry 148,000.
3. Even at 169,000 jobs a month, it would take an unbelievable 9 years and 10 months to return to pre-Great Recession employment levels, according to Brookings. See you in 2023 — assuming no recessions between now and then.
4. Sure, the unemployment rate fell to 7.3%. But that’s only because the labor force participation rate fell to a 35-year low. If it were still at January 2009 levels, the unemployment rate would be 10.8%. As RDQ Economics cautions, “This continued fall in participation should give pause to those who argue that the decline is cyclical and will be reversed.” In other words, the US faces a permanently larger pool of jobless Americans.
5. The employment rate — the share of the non-incarcerated, non-military working-age population with any job — also fell and remains dead, dead in the water. (See above chart).
One reason for that, notes the Economic Policy Institute is “our 3.8 million “missing workers … workers who have dropped out of, or never entered, the labor force due to weak job opportunities in the Great Recession and its aftermath.” If they were in the labor force looking for work, the unemployment rate would be 9.5% instead of 7.3%.
6. Recall that according to the Obama White House’s 2009 stimulus forecast, August 2013 should have been the 2nd straight month at 5% unemployment: