Each month since December 2009, I have been providing a simple analysis of the actual employment numbers in comparison with our growing population. For unemployment to go down in a meaningful way, the actual number of jobs must increase at a rate faster than the population of working age Americans does. In the media, we have heard month after month that fewer jobs were lost lately than earlier in the recession and this was good news. To an extent it is, but to keep things in perspective we need to remember that the American private sector, when not dragged down by government, usually creates many jobs each and every month. Back in January of 2000 the U.S. economy was operating at about as full employment as it ever does. It is useful to compare the employment situation since then with that time. Employment was so enticing then that the number of people with jobs or seeking employment was 67.49% of the total work age population. Assuming that nothing in the country has fundamentally changed in our work ethic or that there is no reason more women or men are staying home to care for children other than a lack of work, we can calculate how many jobs we are missing relative to January 2000. In a long recession, many people who want to work give up looking for work, so the usual unemployment number means little.
The table below provides the employment numbers based on the Household Data of Table A-1 from the
March Bureau of Labor Statistics Employment Report. I use the numbers which are not seasonally adjusted, since I do not have full and complete trust in the seasonal adjustments and there is something strange in saying we have more people employed than actually are employed. Besides, my January 2000 benchmark is also not seasonally adjusted and January is one of the months for which the seasonal adjustment adds employment to the actual case.
The unemployment rate in March was very slightly better than that in February, which in turn had been very, very slightly better than that in January. The seasonally adjusted rate was claimed to be 9.7%. Nonetheless, there was a larger increase in the number of people employed in March than there had been in February. Unfortunately, many of those jobs were temporary jobs such as Census jobs and even the private sector is hiring a larger fraction of its hires as temporary hires than it normally does. We must also remember that many people counted as working here are either working many fewer hours than they want to or they are being paid less than they have been accustomed to being paid. But, ignoring those very important caveats, the number of missing jobs appears to be much improved. January was the worst month of the recession for missing jobs. February had been a micro-improvement on the missing job front, but March made a more substantial improvement. The creation of jobs has a long ways to go though. At the end of March we have still not created quite enough jobs to regain the sorry jobs situation of December 2009!
If the economy were robust and free to perform well, there should probably be about 22 million more jobs than there are and many more jobs should be full-time jobs. It appears that about 13.8% of the jobs desired are missing and that is a generous rendering of the real situation given the many part-time jobs not taken into account here. Note that while the missing job rate improved, the standard unemployment number did not improve anywhere near as much. This is because some of the people who long ago gave up on finding a job are returning to the search, now that some net hiring is occurring.
Obama and the Democrats should have a lot of explaining to do for this slow recovery. The economy would have improved much faster than it has but for the economic uncertainties and the debt these irresponsible fools have created.
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"Obama and the Democrats should have a lot of explaining to do for this slow recovery. The economy would have improved much faster than it has but for the economic uncertainties and the debt these irresponsible fools have created. "
Hey Dr. Anderson,
Don't beat around the bush, tell us what you really think. :)
The problem is that the Dems will tell you that things would have been much worse without the Gov intervention (which I think is nonsense) and there are too many people who agree with them.
The other day you mentioned that the Dems have their own pocket reality. I think that's at play here.
Greg, you are certainly right that the Dems will claim credit for any improvement in the economy. They took advantage of the recession, started by a shocking rise in oil prices, followed by the sub-prime mortgage collapse so strongly and primarily built up at Dem insistence, to gain a stronger control of Congress and the presidency. As the economy, due to the heroic effort of much of the private sector, gets back on its feet, despite every effort of government to prevent that, and it staggers forward with the government weighing it down, the Dems will take credit. I hope enough Americans can see through that, but often they do not. After all, they attributed the recession to Bush even though Democrat policies of long standing did much more to cause it.
You would think that the failure of the stimulus bill to produce any jobs would have some impact on the electorate! Will they remember in November?
Remember in November? Probably. I think there are a lot of people, who aren't saying anything, who plan to give congress a piece of their minds. But then, I could just be a wild optimist.
With the Dems owning all of the print media and most of the TV and radio media it will be interesting. All the same, I think they are in for some pain.
And you know, there was a jump in jobs due to census hiring. Some or all of that should go away right before the elections.
Could be that the Republicans, if they win a bunch of seats, will save Obama's presidency, by forcing rational decisions from him. What do yo think?
I think you are right that the Dems will pay a big price in November for not listening to the people and because they have insulted the people. At some point, the paternalism of the Dems becomes very aggravating. But then Gore really grates on me that way and he came within a whisker of being elected President.
Your concern about the print media is well-placed, but their ability to control the debate and skew the data has been diminishing due to Fox, PJTV, and the Internet generally. The People are actually turning more and more to books and reading more about American history now. Not so many as I wish would do so, but enough to make a big difference in an election. Also, people are actually thinking about whether a bill is constitutional or not now. What a ground shaking change!
Yes, there is a possibility that with many more Republicans in Congress, Obama will have to move more slowly and the frogs will be OK again as the water is ramped up slowly to boiling. But, I think many Americans are now onto this trick. I sure hope they will stay focused on the need to repeal ObamaCare and any other awful bills he and the Democrat Congress pass between now and the election. The stimulus bill was bad and it did set up some Democrat socialist wish list groups who will want to be refunded, but the much worse long term entitlement programs like ObamaCare have to be nipped in the bud. Imagine you were a young person forced to buy health insurance at highly inflated rates to subsidize older and sicker people for a couple of decades and then as you approach the age where you are being subsidized, the whole Ponzi scheme fails or the young finally catch on and rebel against it. For such a person this would be very unfair. The fair thing is to kill this bill as soon as possible. That ought to be in 2013 with a new president. No matter what Obama does, the message has to be clear that he must go because ObamaCare must go.
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