Boy it has been a long time since I've blogged. This morning I'm procrastinating on an overdue term paper, so what better opportunity to get back in the swing?
Today's Employment Situation Report from the BLS brings the good news that the US economy added 157,000 jobs in December 2004...and also some rather disturbing and puzzling trends once one digs deeper into the numbers.
For starters, the dismal jobs outlook faced by workers continues to drive would-be workers from the labor force in despair. Of course, you wouldn't know this if you read the text of the report without looking at the actual numbers in the table. Here is Bush's Labor Department says in the report text: "Both the civilian labor force and the labor force participation rate were about unchanged from the previous month." And here is what the numbers actually show: the civilian labor force dropped by 110,000 workers/job-seekers in December--or the same order of magnitude as the job gains.
Of the 157,000 new jobs in the US economy, only 128,000 were created by the private sector--29,000 were added to government, which everyone from Grover Norquist to Milton Friedman will tell you is part of the problem, not part of the solution (c;. Meanwhile in the Household Survey, which is not designed to measure employment but nonetheless some Bush-loving punditocrats have preferred to tout when it looks better and suits their need, showed declining employment of 137,000 and growing unemployment of 27,000.
Turning to the Establsihment Survey data, the ones that are designed to measure job creation, we make two disturbing observations about the 128,000 private jobs created December. First, at the height of the holiday shopping mania, jobs in the retail trade services industry actually fell by 20,000. (This may be attributable to the seasonal adjustment factors used by the BLS). Second, manufacturing jobs, a key to a prosperous economy, grew by a measly 3,000 jobs (and only that after shrinking by 3,000 in the previous month). Manufacturing jobs remain 3.2 million below their March 1998 local peak and 2.8 million shy of their pre-2001 recession level. Ouch.
Average hourly nominal wages were up a whopping $0.02 in December, or 0.1% over their nominal November level of $15.84. Noting that last month's inflation rate was 0.2% and that Greenspan sees indications of inflation rearing its ugly head, it would be pretty safe to assume that real wages are falling.
But, as always, don't expect the commentators to move the popular discourse on the state of jobs in our economy much past the headline 157,000 number.
