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A Weak Jobs Report

Jun 04, 2010 | By: Mr_Blue | Tags: unemployment, economy, jobs, obama

Contrary to Obama Administration spin, today’s jobs report was weak. The only saving grace was the temporary employment provided by the Census Bureau. Our number one priority, particularly for Obama Administration (and Democrats), should be promoting job creation through stronger and better policies and not spinning weak numbers.

This from Christina Romer, the Chair of the President’s Council of Economic Advisers:

Today’s employment situation report shows continued signs of labor market recovery. Payroll employment rose for the fifth month in a row, and the unemployment rate fell two-tenths of a percentage point to 9.7 percent. While these are encouraging developments, we clearly have a very long way to go until the labor market is fully recovered. It is essential that we continue our efforts to move in the right direction and generate steady, strong job gains and continuing declines in unemployment.

What a missed opportunity! An opportunity to discuss how we need a better stimulus. Preferably one that includes a direct jobs program. Who I am kidding we would never get such a bold proposal from this administration.

So, what did the jobs report actually say? The first paragraph says a lot:

Total nonfarm payroll employment grew by 431,000 in May, reflecting the hiring of 411,000 temporary employees to work on Census 2010, the U.S. Bureau of Labor Statistics reported today. Private-sector employment changed little (+41,000). Manufacturing, temporary help services, and mining added jobs, while construction employment declined. The unemployment rate edged down to 9.7 percent.

The private sector generated ONLY 41,000 jobs in May. Our economy needs at least 125,000 jobs per just to keep up with population growth. Too bad those census jobs are going away soon.

And before the White House gets too excited about unemployment rate declining ever so slightly let’s take a look at the reason for the slight decline:

In May, the civilian labor force participation rate edged down by 0.2 percentage point to 65.0 percent.

Having people drop out of labor force is NOT a good way of lowering the unemployment rate. So much for the spin.

So what is happening? Businesses are not sure or have much confidence in future business or demand for product/services so they are not hiring. People are not going to spend if they are not confident about their job prospects. It’s that simple.

The best way to provide jobs NOW and jump start the economy is by a direct jobs program.

Good luck.