The report came out this morning, and while the media and the White House give it the expected fluff, it was actually not so good news:
The economy in July generated 117,000 jobs and the unemployment rate declined from 9.2 percent to 9.1 percent.
This is nice until you remember that the economy needs to create about 150,000 jobs just to keep pace with the growing work force. The decline in the unemployment rate was not due to the new jobs, but to people giving up searching for jobs. They are then not counted as unemployed, since they are not even looking.
Now, July was better than June, and the numbers were better than expected. But overall, we’re in worse shape than we were.
As we’ve seen again and again, it’s not so much that the administration is ambiguous and outright deceptive about these economic reports, it’s that the media is complicit in their deception. Par for the course from the left.
Pining for a glimmer of good economic news for their beloved President, the media cheered the report, which showed 290,000 new hires for April (60,000 coming from Census padding), while the unemployment rate creeped to 9.9%.
The rate increased because more unemployed “entered” the work force by actively looking, as opposed to sitting out the search. So the increase in the rate while over 200,000 workers were hired is a statistical anomaly, but enough to get the administrations cheerleaders in the press all giddy.
Buried towards the lower half of this AP piece however, a not-so-great indicator:
Counting people who have given up looking for work and part-timers who would prefer to be working full time, the so-called underemployment rate rose to 17.1 percent in April, up from 16.9 percent in March. It’s close to record high of 17.4 percent set in October.
The number of people out of work six months or longer reached 6.7 million in April, a new high. These people made up 45.9 percent of all unemployed people, also a record high.
Calculated Risk digs deeper into the BLS report:
The number of long term unemployed is one of the key stories of this recession, especially since many of them are now losing their unemployment benefits. Note: In Q1, all of the increase in income – and much of the increase in consumption – came from government transfer payments for unemployment benefits.
So, the “encouraging” news from this employment report is that more unemployed people are deciding to get back to looking for work! Meanwhile, the government is subsidizing incomes and consumer spending. Our transformation to a liberal utopian Eurostate is right on schedule.