The establishment survey for September showed desultory hiring, in line with previous monthly reports. Private-sector payrolls rose by only 104,000, less than economists’ projections. Government employment increased by 10,000.Expectations revised downward plus students returning early to college because Labor Day came early this year equals fewer unemployed workers in a smaller full-time labor force.
The combined total was considerably lower than the upwardly revised figures of 142,000 for August and 181,000 for July. Manufacturing jobs actually declined by 16,000 in September, the second consecutive monthly drop. The biggest increase in payrolls was in the lower-paying service sector.
The household survey showed a totally unexpected increase of 873,000 Americans with jobs, the biggest monthly jump in 29 years. It also showed a decline of 456,000 people out of work and the entry of 418,000 more people into the labor force. Thus, according to these figures, the decline in the jobless rate was not, as in previous months, the result of more discouraged workers giving up looking for a job, but rather an increase in both hiring and job-seeking.
Steve Haugen, an economist at the BLS, provided CBS News with a partial, but plausible, explanation for the improbably positive household survey results. He noted that people in the 20-24 age group, including college students and those who often work temporary jobs, left the job market this summer in August, earlier than usual, confounding the expectation of the BLS that they would leave in September.
Since the BLS does seasonal adjustments of its data, a big decline in employment in this demographic was factored into the bureau’s calculations for September. “Because there was no decline,” Haugen said, “there’s a big increase after seasonal adjustment.” In other words, perhaps hundreds of thousands of nonexistent temporary jobs were reported to exist.
An essay by former Secretary of Labor and regular Ed Schultz guest Robert Reich is instructive, in part for what it sees, and in part for what it does not see.
According to the separate payroll survey undertaken by the BLS, just 114,000 new jobs were added in September. At least 125,000 are needed per month just to keep up with population growth. Yet August’s job number was revised upward to 142,000, and July’s to 181,000.Secretary Reich offers the expected Democratic talking points. Then he gets interesting.
In other words, we’re still crawling out of the deep crater we fell into in 2008 and 2009. The percent of the working-age population now working or actively looking for work is higher than it was, but still near a thirty-year low.
But at least we’re crawling out.
Romney says we’re not doing well enough, and he’s right.
Romney promises if elected the economy will create 12 million new jobs in his first term. If we were back in a normal economy, that number wouldn’t be hard to reach. Bill Clinton presided over an economy that generated 22 million new jobs in eight years – and that was more than a decade ago when the economy and working-age population were smaller than now.Here's what's missing from the picture. First, the structural problem might be a mis-match of jobs requiring skilled tradesmen and a work force holding the wrong kinds of college degrees, or lacking aptitude or desire to acquire those skills. Second, the structural problem might be precisely the cold dead fingers of the current administration's pork barrel projects masquerading as economic stimulus, its health care reforms that will constrain people unto the third generation, its continued mau-mauing of successful people as lucky or ungrateful. I've heard some claims that 12 million jobs are about what one would expect of the United States's private sector as a matter of course. Perhaps, though, those cold dead fingers have to be pried away before events can run their course.
Both Obama and Romney assume the recovery will continue, even at a slow pace, and that we’ll be back to normal at some point. But I’m not at all sure. “Normal” is what got us into this mess in the first place. The concentration of income and wealth at the top has robbed the vast middle class of the purchasing power it needs to generate a full recovery – something that was masked by borrowing against rising home values, but can no longer be denied. Unless or until this structural problem is dealt with, we won’t be back to normal.