The Rooster Crowing

The 2008 recession, that Obama inherited, cut 8.7 million jobs out of the U.S. economy … and now, just after 4 ½ years in office, this administration can crow about returning this same number to the job market … see: CNN Story. This is obviously good news … but there are three clouds to this silver lining:

-        During this same period the population of this country has grown by 11.7 million. For employment levels to be equivalent on a percentage basis to what they were in 2008, our economy would have to have grown jobs by an additional 7 million (see previous link).

-        It is estimated that, of the 8.7 million new jobs created under Obama, almost one million of them are on a part-time or contract basis (see: Sun Times Story). This typically means no health-care, no bonuses, and few of the many other perks afforded to full-time employees. One reason for this plethora of part-timers obviously has to be Obamacare.

-        Average weekly earnings of our working population has stagnated over this same 4 ½ years … growing less than 2% per year since Obama’s inauguration … whereas median earnings have grown at almost 3% … see: Social Securit Administration Numbers. This of course is a function of the level of part-time and contract employment … but it also highlights the growing inequality of incomes within our economy. This is something that Obama decries but does not seem to be able to do anything to correct.

So when you see the Barack rooster crowing about his record on job growth, you can now, being in the know, quietly smile to yourself … or, like myself, shout at the TV.

"Lucy

Lucille Ball

you got some splainin' to do" ...  In this case "Lucy" is the Bureau of Labor Statistics.  We were greeted this morning with some encouraging employment numbers (see: LA Times Story).  In particular, this nation's unemployment rate has dropped to 8.3%.  As is my wont, I then went to the source data at the Bureau to see what was what (see: CPS Tables and click on the HTML version of the A-1 table under Monthly Household Data).  And what I found was puzzling ... the civilian noninstitutional population (a non-seasonally-adjusted number) increased by almost 1.7 million in the month of January alone.  This compares to an average increase throughout all of 2011 of around 140 thousand per month.  This makes the current figure over 12 times higher than what might be considered normal!  This is certainly an outlying statistical jump and needs to be explained if one is to understand (and maybe even trust) these new good unemployment numbers.

My guess -- perhaps it is the huge jump in foreign nationals entering the U.S. to take jobs not given ... or maybe not even offered to U.S. citizens (see: Numbers USA) and this needs to be accounted for by the Bureau ... and it chose to do so all in the month of January.

And also please note the very large pop in the number of people who have left the labor force in January  ... almost 1.2 million versus an average of 215 thousand per month throughout 2011.  This is up by a factor of almost 6!  I find this too to be somewhat strange.

So, although the reported unemployment numbers do appear to be encouraging for our economic prospects, I am not doing cartwheels quite yet.