If all you heard about the September 2011 Employment Situation released this past Friday from traditional media and stock market reports that the market closed up you would conclude that the employment situation was just hunky dory. But if we were given some context about September’s job number we would realize that it’s just another weak report and another indication that the ‘New Normal’ will be very painful for most families.
Context matters particularly in terms of economic data. Bureau of Labor Statistics released the September Employment Situation last friday. The main story from the report were 103,000 jobs created in September and 9.1% unemployment which was unchanged from August. Sounds positive but there is more information - troubling information that was excluded from most traditional media’s analysis of the release. One huge omission from news reports was that 103,000 jobs included 45,000 returning Verizon workers who were on strike in August so if excluded those jobs then the economy only generated 56,000 new jobs. Oh, but there’s more.
Economic Policy Institute has been providing some very important analysis and context for the monthly job reports. This is what they said about Friday’s report:
The U.S. is currently 6.6 million jobs below where it was when the recession started. But because the working-age population grows as the population expands, in the three years and nine months since the recession started we needed to have added around 4.5 million jobs to keep the unemployment rate from rising. Putting these numbers together means the current gap in the labor market is roughly 11.1 million jobs. To ﬁll that gap in three years—by Fall 2014—while still keeping up with the growth in the working-age population—would require adding around 400,000 jobs every single month. To ﬁll the gap in five years—by Fall 2016—would mean adding 280,000 jobs each month. By comparison, over the last three months, the economy added just 96,000 jobs per month on average. At this rate, the unemployment rate will not come down.
Wow, 400,000 jobs per month! We’re not even close to that. The jobs hole is very deep and weak job growth as reported on Friday will help very little. Even future prospects for significant job and economic growth appear very bleak especially with more talk of austerity at federal, state and local levels.
Oh, but wait there’s even more context that was missing from traditional media reports:
Not to mention that the unemployment rate held steady at 9.1% - a relatively high number.
Want more context? Let’s not stop with just the employment situation. What household incomes? High unemployment provides downward pressure on wages and incomes. So it should not be a surprise when we read or hear about reports like this:
Between June 2009, when the recession officially ended, and June 2011, inflation-adjusted median household income fell 6.7 percent, to $49,909, according to a study by two former Census Bureau officials. During the recession — from December 2007 to June 2009 — household income fell 3.2 percent.
Welcome to the New Normal! This is going to be painful. But it doesn’t have to be this way. There are alternatives/solutions to this New Normal.
economy financial+crisis budget+deficit obama unemployment jobs credit+cards debt social+security personal+finance capitalism deficit bailout mortgage mortgage+crisis economic+crisis wall+street+bailout new+economy retirement+savings job+guarantee credit+unions deficit+hawks economic+stimulus cooperatives health+care+reform financial+regulatory+reform income+inequality financial+conglomerates tarp financial+oligarchy 401k worker+cooperatives gdp federal+debt debt+management new+normal money scams fiat+currency federal+reserve wages globalization savings consumer+protection stimulus neoliberal unemployment+rate tax+cuts wall+street middle+class investing consumer+debt investments china economic+growth credit+card+debt debt+settlement federal+deficit democrats republicans stocks government+spending negative+equity risk foreclosure budget financial+planning cfpa ira class+war inflation jobs+report financial+bailout fiscal+policy evil pete+peterson health+care financial+literacy jobs+crisis foreclosures move+your+money full+employment modern+monetary+theory stock+market neo-liberal checking economic+policy u.s.+treasuries job+growth bonds economic+mobility bank+of+america foreclosure+fraud taxes consumer+spending class+warfare bankruptcy mortgages derivatives goldman+sachs eu great+recession debt+consolidation gold keynes refinance fico+scores debt+crisis credit+scores real+estate mortgage+foreclosure financial+regulation banking+system federal+budget de-regulation financial+crisis+inquiry+commission deficit+commission debt+servitude krugman free+trade solidarity wisconsin income+tax refinancing debt+collection loan+modifications trickle+down+economics financial+stability+plan poverty retirement working+class currency monthly+budget wills economics #finreg tbtf estate+planning consumer+credit gold+standard debt+ceiling auto+industry president+obama center+for+responsible+lending mutual+funds innocent+fraud aig life+insurance personal+income market+fundamentalism consumer+financial+protection+agency trade+deficit banking identity+theft cash+flow compound+interest fraud too+big+to+fail fdic state+of+the+union predatory net+worth u.s.+treasury+securities tax+refund debt+forgiveness lehman+brothers cornel+west exuberance denmark propaganda banking+services john+k.+galbraith monetary+policy option+arm mortgage+loan+modifications subprime+mortgages corporate+profits disposable+income national+infrastructure+bank corporate+welfare u.s money+manager+capitalism birth+certificate quantitative+easing political+system fundamentals living+wage output+gap success consumption interest+rates greece universal+health+care income+distribution household john+mccain minimum+wage new+democrat+coalition two+americas ltcm frontline senate+democrats eurozone debt+commission haymarket american+recovery+and+reinvestment+act oligarchy two+economies income regulations ben+bernanke california+budget catfood employee+ownership existing+home+sales jobless+recovery carried+interest john+edwards mark+to+market budgets payroll+tax euro chicago+idea paladino robert+reich gmac life+settlements tax+holiday ireland mlk fannie+mae housing+market cowards slavery dollar sector+balances target+date+mutual+funds argentina fierce subprime bad+bank bullshit phone+scams financial+regulations national+debt free+markets united+states now savings+plan alan+greenspan deficit+errorists payroll+tax+holiday time+value+of+money cost+of+unemployment ponzi+schemes swipe+fees savings+bonds shadow+banking+system fica+tax madison paulson future+value pensions fed+audit debit+cards credit+markets fair+debt+collection+practices+act tax+code #wallstreetscam great+divergence warren+buffett treasury+department present+value tax+deal cooperative+economy predatory+home+lenders cash cdo walker ppip job+loss 20-year+mortgage obama+tax+deal short+sales liquidity u.s.+debt poverty+rates conservatives home+buying economic+purgatory long+term+unemployment vicious+cycle cash+management treasury+securities detroit+schools home+closing banks deficit+hawk american+capitalism bartering emergency+savings efca debt+hysteria online+scams income+taxes investment inequality community+gardens economic community+banks debt+to+gdp recession austerity email beige+book mortgage+modifications yuan risk-return investment+advice estate investment+yields happy+year finreg hyman+minsky american+dream malicious+software deflation corporate+bailouts federal business+roundtable cooperation dot+com+bubble leading+economic+indicators deferred+annuities bailouts economic+policies balancing+checkbook alternatives returns housing+bubble chris+dodd lei fixed+rate+annuity lobbyists debt+is+evil disability+income+insurance scam fiscal+sustainability home+mortgage insurance variable+rate+annuity corporate+tax+breaks credit+card+law deficit+spending tina balance+check+book credit+report teach-in currency+manipulation bill+gross foreclosure+rescue+services gross+domestic+product race+to+bottom big+banks marx june+jobs+report general+motors economic+indicators budgeting financialization warren+mosler washington+consensus emergency new+capitalist+manifesto bank+fees credit+card minsky tips open+auction lost+decade financial+genocide republican+budget human+capital direct+deposit reaganomics overdraft cfpb galbraith social+security+cards geithner commercial+real+estate direct+jobs+program civil+disobedience balance etf economic+justice barack+obama worker+ownership personal+consumption treasuries protests gas+prices obama+administration destruction citizens+united outlays wall+street+bailouts exports household+debt fallacy+of+composition securities+laws save public+option living+standard unions july+2011 unemployment+benefits imports card+act fallacies emergency+funds deductibles strategic+defaults keynesian wiped+out productivity+ralph+nader new+era+windows laid+off citigroup financial+sector foreclosure+gate auto+loans human+capitalism savings+tip financial+reform arra free+credit+report chicago money+market+accounts unemployment+insurance fox+news+channel credit+rating+agencies credit+reports fallacy money+market+mutual+funds afl-cio fox move+money predatory+lending refund+anticipation+loans jobs+data moody's revolution tax+reform uaw employment principal+reduction roger+ailes close+banking+accounts countervailing+powers