July 3 2014
The New Jobs Report: Good News Mixed with Not-so-Good News
We head into the Fourth of July weekend with some good news on the jobs front. The BLS reported this morning:
Total nonfarm payroll employment increased by 288,000 in June, and the unemployment rate declined to 6.1 percent, the U.S. Bureau of Labor Statistics reported today.
Job gains were widespread, led by employment growth in professional and business services, retail trade, food services and drinking places, and health care.
We rejoice for every person who got a job in June. We rejoice because they will have paychecks and experience the dignity of work, the essentials to getting into and staying in the middle class. This is the best jobs report in a long time. The Dow surged to 17,000 on the strength of this report.
But—let’s face it—there was a time when we didn’t get giddy over an unemployment rate that is just above 6 percent.
I can’t help remembering the title of the old Richard Fariña novel (later a pop song): “Been Down So Long It looks Like Up to Me.” What is this going to be—our fifth “Recovery Summer”?
Embedded in the BLS report are some discouraging numbers. There are more people who would like to work full-time working part-time. This number is now at 7.544 million. Hot Air points out that June’s number is still 287,000 higher than January.
Powerline also points out some sobering facts:
* The number of people aged 16 years and above who are not in the labor force increased by 111,000 this past month. While a somewhat lower increase than in months past, it still outpaces forecasted retirements.
* The number of people taking part-time jobs because they cannot find full-time work increased by 275,000 this past month.
* In fact, the number of people employed full-time (according to the household survey that also counts self-employed) declined by 523,000 while the number of part-time workers increased by 799,000 (which includes those who wanted part-time and those who wanted full-time but could only find part-time). These estimates are seasonally adjusted to account for the normal increase in June part-time work.
* The U-6 unemployment rate (the broadest measure of unemployment) remains virtually unchanged at 12.1 percent. U-6 includes those people who are discouraged, only occasionally trying to find work, and those employed part-time for economic reasons.
Let's celebrate the dynamism of the American economic machine.
And let’s hope we are on an upward trajectory. But it may be premature to count on this: when the ObamaCare employer mandate goes into effect in January, we may see more turbulence ahead.