Here’s Alan Krueger’s post about the economy:
While more work remains to be done, today’s employment report provides further confirmation that the U.S. economy is continuing to recover from the worst downturn since the Great Depression. It is critical that we remain focused on pursuing policies to speed job creation and expand the middle class, as we continue to dig our way out of the deep hole that was caused by the severe recession that began in December 2007.
Today’s report from the Bureau of Labor Statistics (BLS) indicates that the unemployment rate declined from 7.6 percent to 7.4 percent in July, reaching its lowest level since December 2008. The unemployment rate for African Americans fell from 13.7 percent to 12.6 percent, also its lowest level since December 2008. The unemployment rate for women fell from 7.3 percent to 7.0 percent, its lowest level since January 2009, and from 7.8 percent to 7.7 percent for men.
The establishment survey showed that private sector employers added 161,000 jobs last month (see chart below). Total non-farm payroll employment rose by 162,000 jobs in July. The economy has now added private sector jobs for 41 consecutive months, and a total of 7.3 million jobs have been added over that period. So far this year, 1.4 million private sector jobs have been added.
Now that we’ve heard the administration’s spin, it’s time to deal with reality:
When the payroll report was released last month, the world finally noticed what we had been saying for nearly three years: that the US was slowly being converted to a part-time worker society. This slow conversion accelerated drastically in the last few months, and especially in June, when part time jobs exploded higher by 360K while full time jobs dropped by 240K. In July we are sad to report that America’s conversation to a part-time worker society is not “tapering”: according to the Household Survey, of the 266K jobs created (note this number differs from the establishment survey), only 35% of jobs, or 92K, were full time. The rest were… not.
These graphs, which I’m calling the King Banaian section of the post because of King’s love of charts and graphs, tell a devastating story:
The reality is we’re becoming a part-time nation. These graphs verify that. There can’t be any questioning of that.
Krueger is right. We’ve turned the corner. It’s just unfortunate that we’ve turned from being a full-time worker nation to being a part-time worker nation. This isn’t a recovery. It’s a stagnation. In fact, Tyler Cowen wrote a book calling President Obama’s economic record the Great Stagnation. This administration, as Jim Hoft reminds us monthly, is the worst job creation administration since the Great Depression.
If we used the labor force participation rate, aka the LFPR, we had at the start of January, 2009, the real unemployment is close to 12%. Real income has dropped 5% since President Obama took office. Most of the jobs being created are part-time jobs. The only people who’ve gotten ahead since President Obama took office are employed by Wall Street or the federal government.
Small businesses are suffering. The middle class is getting squeezed like never before. That isn’t turning the corner. That’s taking a nosedive. Today’s jobs report is just the latest proof that President Obama’s policies have failed.
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