US unemployment figures came out today. The market was expecting a drop of 130,000 in unemployment, and in fact got pretty much what it expected – creation of 120,000 jobs.
(The Bureau of Labor Statistics website crashed, by the way, which suspicious minds would take as evidence that White House data tampering had caused some system failures … but the tampering hadn’t reached as far as the phone lines, so I called instead.)
But if you look beneath the surface, the figures remain pretty horrible. First and foremost, in a continuing trend the BLS reported that the labor force has contracted by more than 315,000 people.
Huh? What’s happened? Alien abductions over Rhode Island? The Canadians have invaded Seattle? Someone lost Hawaii? The truth, of course, is that people are quitting the labor market in despair. People who want to work – can work – have the skills to work – are ready to work- are simply retreating from the market. That’s terrible news. Many of those people will never return to work again. A lost generation.
The White House will proclaim victory – a labor turn around – ” Household survey numbers dropped from 9% to 8.6%”. Hold the phones a second, let’s take a look at where those jobs are being created. We’ve got 50,000 retail hires. 33,000 in food service. 20,000 in the leisure industries. These are, typically, low-wage, low-quality, low-skill and low-security and a slew of temporary jobs – the kind the United States least wants and least needs.
The suspicion that these jobs figures are packed with burger-flipping Santas is confirmed by the wage data. Real wages are down – that’s the impact of all those people joining the job rolls at minimum wage.
If this is the recovery that the White House and Congress has in mind for us, it’s a recovery barely worthy of the name.