Nonfarm payroll employment fell sharply in January (-598,000) and the unemployment rate rose from 7.2 to 7.6 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Payroll employment has declined by 3.6 million since the start of the recession in December 2007; about one-half of this decline occurred in the past 3 months. In January, job losses were large and widespread across nearly all major industry sectors.
The news further down paints an even darker picture:
The civilian labor force participation rate, at 65.5 percent in January, has edged down in recent months. The employment-population ratio declined by 0.5 percentage point to 60.5 percent over the month, and by 2.4 percentage points over the year.
The civilian labor force participation rate was 65.7% as of December 2008 and had been as high as 66.4% as of December 2006, which means the rise in the unemployment rate actually understates the fall in the employment-population ratio, which fell from 61% as of December 2008 to 60.5% last month. The employment-population ratio had been 63.4% as of December 2006. While some of us were unimpressed with the employment-population ratio being only 63.4% given that this ratio was at or above 64% for much of Clinton’s second term in office, I’d be incredibly happy if we could see the employment-population ratio approach this level in the next couple of years. Of course, this is not likely to happen unless Congress pass a stimulus bill over the objections of the Herbert Hoover faction.
This (and everyone else's posts commenting on the subject, it seems) still misses the biggest point: the working age population grew by about 21 million between January 2001 and January 2009, and by historical standards, about 13 million new full-time jobs would have been generated simply by a steady-state economy. In reality, there were FEWER full-time jobs last month in absolute numbers than the month Clinton left office. That is in real terms a loss of 13 million full-time jobs and a 10% contraction in the real (full-time) workforce. It is masked by the huge shift to part-time work (for economic reasons), but that is a monstrously stunning number. And that doesn't even get to the hollowing out of the quality of the jobs.
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