Economist Heidi Shierholz: “There’s never been a pool of missing workers this large”Posted: January 7, 2011
Economics isn’t my area of expertise, but I can read, and the top story at Huffpo right now is pretty disturbing. Author Lila Shapiro spoke to some economists, including Heidi Shierholz, about the December jobs report, which came out today.
Although the unemployment rate fell to 9.4 percent from 9.8 percent in December, bringing the total number of officially unemployed Americans to 14.5 million, only 103,000 jobs were added in December according to the Labor Department’s BLS report — a number significantly lower than expected. (The Wall Street Journal reported that many Wall Street analysts were predicting “at or above 200,000” new jobs.)
The news gets worse: less than half of the drop in unemployment rate can be attributed to new job creation — the other half came from 260,000 Americans who have dropped out of the labor force altogether.
This brings the percentage of Americans who are either employed or actively looking for work down to 64.3 percent, what economist Heidi Shierholz calls “a stunning new low for the recession.”
“We have now added jobs every single month for a year,” Schierholz said. “So you would think that there would be labor force growth, these missing workers starting to come back in. Not only is that not happening, it’s actually starting to go in the other direction. There’s never been a pool of missing workers this large. It’s not clear to me when they’ll come back.”
That can’t be good, no matter what the White House and CNN try to get us to swallow.
At the Wall Street Journal the reaction to the jobs report doesn’t make things sound much better. One headline reads: Markets Whipsawed After Jobs Report. Here’s the gist:
Investors hoped that the jobs report would confirm expectations that a robust recovery was finally filtering through to long-stagnated labor markets. But after traders positioned aggressively this week on lofty expectations of a strong payrolls figure, the disappointing data had a relatively muted impact.
The Labor Department reported that the U.S. economy created 103,000 new positions last month, far below market consensus expectations for a 150,000 gain. In November, the economy added 39,000 jobs. The unemployment rate fell sharply to 9.4% from 9.7%.
Sustainable job creation has been elusive in an economy that is still recovering from the 2008 financial crisis. As a result of the troubled job market, analysts think the Federal Reserve is likely to continue full steam ahead with its controversial $600 billion plan to reinflate the economy.
Dakinikat can give us her expert take on this, but as a layperson, I think it’s obvious that the country is on the wrong track and some one needs to light a fire under the President and his incompetent economic advisers.
HEY VILLAGERS! WE NEED JOBS!!!