At first blush, the latest monthly report by the Bureau of Labor Statistics on the nation’s employment situation seemed to us a cause for celebration, what with 288,000 jobs created in June and the unemployment rate declining to 6.1 percent.
Then we read a disquieting analysis by the liberal Economic Policy Institute, which made the persuasive case that the unemployment rate “is vastly understating weakness in today’s labor market.”
That’s because of the large pool of “missing workers,” as EPI describes them. Those nearly 6 million potential workers are “neither employed nor actively seeking a job,” EPI explains, “because of weak job opportunities.”
If that cohort was included in the federal government’s “official” unemployment rate, it would have been 9.6 percent in June, rather than 6.1 percent.
And the Obama White House wouldn’t be crowing that the “unemployment rate has fallen 1.4 percentage points over the past year,” the supposed “sharpest year-over-year decline in nearly three decades.”
Then there are the more than 7 million Americans holding down part-time jobs because they cannot find full-time work. There also are nearly 3 million temporary workers that would prefer to be permanently employed. They are not missing workers, per se. They simply are under-employed.
Perhaps, the most troubling, underpublicized piece of data that appeared in BLS’ latest monthly jobs report is the nation’s 62.8 percent labor participation rate, the lowest in more than three and a half decades.”
Indeed, there were 92.1 million working-age Americans out of the workforce in June, according to BLS. That’s an increase of nearly 2.4 million Americans that have dropped out of the nation’s labor pool since last June.
As to the officially unemployed — the 9.5 million Americans that have not dropped out of the workforce, but simply can’t find gainful employment — nearly a third have been jobless 27 weeks or more.
Those long-term unemployed workers, as BLS designates them, are considered in some quarters the most meaningful barometer of the nation’s employment situation. In fact, Federal Reserve chair Janet Yellen suggested as much in a speech last week to the International Monetary Fund.
That portends that the nation’s central bank will not be raising interest rates in the near term, as inflation hawks advocate, no matter that 244,000 jobs were created in June, “the first time since September 1999-January 2000 we have seen job growth above 200,000 for five straight months,” the White House pointed out.
Well, we are cautiously optimistic that July will bring a sixth straight month of job growth above 200,000 and that a total 1.4 million jobs will be added in the second half of this year. But until we see both, we’ll hold off on singing “Happy Days are Here Again.”
From the Orange County Register