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Jewish World Review August 9, 2011 / 9 Menachem-Av, 5771 U.S. treading water on job creation By Dale McFeatters
http://www.JewishWorldReview.com |
There are two good things that can be said about July's unemployment rate of 9.1 percent: It's lower than June's 9.2 percent and it allayed, perhaps only temporarily, market fears of a double-dip recession.
But reading behind the figures reveals a disturbing fact about job creation since we officially came out of the recession in July 2009: We're pretty much stuck. Only twice since then has the rate fallen below 9 percent.
The July figure showed improvement only because the workforce shrank by 38,000 and perhaps as many as a million simply quit looking for work and thus weren't counted in the unemployment figures.
Private employers added 117,000 jobs, and that's good. But the economy needs to add 125,000 jobs a month just to stay even with the demand for work. The total number of jobless dropped over the month from 14.1 million to 13.9 million, but that's still almost double the number before the recession.
To put a serious dent in that number we need to create 250,000 jobs a month, and that requires serious economic growth. The increase in gross domestic product for the first six months of this year was just under 1 percent.
The underemployment rate, which some feel is a more accurate picture of how the average person experiences the job market, fell only one-tenth of a point, to 16.1 percent. That rate combines part-timers who want full-time work and those who are so discouraged that they're not even looking for work.
There are serious long-term problems ahead in the jobs market and no indication that Congress is willing to seriously address them. Indeed, if lawmakers persist in their drastic two-step cut in government spending, they will only make the problem worse as the federal government lays off workers, as do the states who depend on federal help; and the government lets fewer contracts for goods, services and construction, and layoffs begin to spread through the ranks of federal contractors.
In the meantime, workforce participation, the percentage of Americans eligible to hold a job that have one, is 58.1 percent, the lowest since the recession year of 1983. Also, people are out of work longer. The average duration of unemployment is at a record 40.4 weeks.
President Barack Obama has proposed extending a one-year Social Security tax cut that would benefit the average worker by $1,000 to $2,000 and renewing the emergency unemployment benefits that now cover up to 99 weeks.
But these are Band-Aids. More serious action is required, but, sadly, this feckless Congress is likely incapable of providing it.
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