The latest government employment figures show that the recovery in the jobs market is real, but still not strong enough or fast enough to get us back to full employment in a reasonable time frame.
The latest government employment figures show that the recovery in the jobs market is real, but still not strong enough or fast enough to get us back to full employment in a reasonable time frame.
Private industry created 233,000 jobs in February, beating Wall Street expectations and completing three of the best months of hiring since the recession began. Indeed, hiring in January and February was better than thought, with the Labor Department revising those figures upward by 61,000 jobs.
The February figures would have been even better except for the 6,000 cut from government payrolls, itself an improvement because governments had been cutting jobs at the rate of 22,000 a month.
Despite the increase in hiring, the unemployment rate stayed stuck at 8.3 percent as workers who had given up looking returned to the job market. Indeed, the improvement in the jobs outlook drew a half million people back into the workforce, and the government says most of them found jobs.
A rise in the unemployment rate would horrify the White House, but an increase, counter-intuitively, might be a sign of good things to come because it would mean more people were getting off the couch to look for work.
The unemployment rate only counts those actively looking for work. And, in fact, labor-force participation is 63.9 percent, near historic lows.
To return to something like full employment — which we last enjoyed in January 2008, and then immediately fell off a cliff — the economy needs to create over 10 million jobs: 5.3 million to make up for the ones we’ve lost, and 5 million to accommodate new entrants into the workforce.
The unemployment rate is perhaps the government’s most politically symbolic statistic, never more so than during an election year.
President Barack Obama’s critics note he will be running for re-election with the highest jobless rate of any postwar president, none of whom was returned to office when the unemployment rate was greater than 8 percent.
The key element in the political equation will be how voters feel about the economy, and the figures indicate that a sense of guarded optimism is returning.
The rate of underemployment is 14.9 percent, the lowest in three years. Applications for unemployment benefits have fallen 14 percent in the past six months, and the average for new claims is near a four-year low.
Worker productivity last month grew at its slowest pace in 25 years, but in a perverse way that is a positive development.
As the Associated Press coldly explains it, that means companies have squeezed as much out of their existing employees as they’re going to get and will have to start hiring new ones to sustain production. The sooner they do so, the better for all of us.
Dale McFeatters is chief editorial writer and a columnist for Scripps Howard News Service.