Friday, the official employment numbers came out, and economists have been arguing about what they mean since then. According to the BLS, there were 132,000 new jobs added to the economy in June, and a revised gain of 190,000 from a previously reported 157,000 in May, and a gain of 122,000 instead of 80,000 in April. Also, “modest” gains in wages, “modest” economic growth, and steady unemployment at 4.5%. Now, please remember that most economists agree that it takes 150,000 to 200,000 new jobs per month to just keep up with new people joining the workforce. Oh, and let’s not forget that May and June are the months when young people leaving school are seeking full time employment.
According to Reuters, “Strong jobs growth bodes well for economy”. However, Max of Max Speaks points out that those young people I was talking about actually have sharply declining employment rates. He does not go on to rub our noses in the fact that these young people without jobs do not count in the unemployment rate because they did not lose full time jobs. This item from economist Dean Baker points out that employment rates among workers aged 25-54 has been steadily dropping too. That is a huge demographic! He concludes:
It is very difficult to think of any reason why hundreds of thousands of prime age workers (both men and women, the declines are roughly equal) would suddenly drop out of the labor market, other than limited job opportunities. While this situation is not disastrous, the data on EPOPS is not consistent with a strong labor market.
Ouch, logic hurts.
The Center for American Progress goes so far as to say that the current levels of job growth look good because of “diminished expectations”. Via Brad DeLong we have Fed may be questioning labor-market tightness, which again points out that “The low unemployment rate reflects in part a recent drop in the ‘participation rate’ — the share of working-age people either on the job or looking for work….” This article and several others are quoted by the Angry Bear — oh my I can’t imagine what his biases might be! — who points out that the job gains are largely sector driven, and the wage gains reported not really worth reporting. He even asks “Did they outsource their reporting to Lawrence Kudlow?”
The short version of the story is that more and more economists are losing their rose-colored glasses, putting away the Kool Aid, and really looking at the economy.
In closing: Star Trek: Hidden Frontier; I hope to say more about the upcoming debate about farm subsidies this week; the BBC reports that the Navy is saying maybe something bad did happen in Falluja; Sara Taylor, political football in the Battle Royale between Executive Authority and Congressional Subpoena; amazing how “tax and spend” a libertarian leaning conservative becomes when he faces the hard truth that somebody has to pay to keep roads moving; a handy timeline of dangerous Chinese products in 2007, broken down by month, is a lot longer than you would think; and finally, CNN reports on the Kami-kaze legacy.
Interesting to note that the Center for American Progress has some pretty firm numbers and data for the “Hispanic Population.” The center also says that construction has been a keystone (my word) for Hispanic employment.
(WTF? I thought they were only taking the jobs Americans wouldn’t do)
That assumes you believe there *is* such a thing as “Jobs Americans Won’t Do.”