Commentary Magazine


Topic: unemployment

The Jobs Report

The latest jobs report from the Bureau of labor Statistics was released this morning. It has some good news in that the unemployment rate fell two-tenths of a percent to 7.7 percent, and a net of 236,000 jobs were created (there were 246,000 jobs created in the private sector, while government shed 10,000).

Since 236,000 is above the rate of population growth, if it continues–and job growth has averaged 195,000 over the last three months–it would mean a slow, steady improvement. But, ironically, such an improvement might mean a short-term rise in unemployment as more people, encouraged by the number of new jobs, re-enter the labor market. The current unemployment rate is a mere one-tenth of a percent below where it was last September.

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The latest jobs report from the Bureau of labor Statistics was released this morning. It has some good news in that the unemployment rate fell two-tenths of a percent to 7.7 percent, and a net of 236,000 jobs were created (there were 246,000 jobs created in the private sector, while government shed 10,000).

Since 236,000 is above the rate of population growth, if it continues–and job growth has averaged 195,000 over the last three months–it would mean a slow, steady improvement. But, ironically, such an improvement might mean a short-term rise in unemployment as more people, encouraged by the number of new jobs, re-enter the labor market. The current unemployment rate is a mere one-tenth of a percent below where it was last September.

Break the figures down a little, however, and things aren’t quite so rosy. Unemployment among some subgroups, such as teenagers (25.1 percent), blacks (13.8 percent) and young adults 18-29, (12.5 percent), is much higher than the overall number. It’s still a dismal time to be graduating from school and entering the job market for the first time.

The long-term unemployed, which is to say those out of work for 27 weeks or longer, now number 4.8 million, fully 40.1 percent of all unemployed. Part-time workers who wish they could have full-time employment number 8 million.

Worse, the workforce participation rate, the percentage of the working-age population that is actually working, is only 63.5 percent. At the start of the recession it was 66 percent. In other words, millions of people have dropped out of the labor force. If they had not, the unemployment rate would be over 10 percent.

So while things are improving, they are a long way from good. The slowest recovery from recession since the Great Depression continues.

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Obama’s Pivot Away from Jobs

It hasn’t been a good week in economic news. Earlier this week we learned that the GDP contracted. John Steele Gordon wrote at the time: “The GDP shrank in the last quarter of 2012, declining a small 0.1 percent. While that is minimal, it is the first negative quarter since the second quarter of 2009 and a sharp slowdown from the 3.1 percent growth in the third quarter.” Today he wrote about the disappointing jobs numbers, which showed low growth and a slightly higher unemployment rate. 

It’s interesting that this week, in light of all of this economic doom and gloom, that the Obama administration has decided to layoff its long-defunct Jobs Council, which was set to expire this week. Don’t worry about these layoffs, however, as the Council was composed of business and labor leaders–they all have day jobs to fall back on. The Council hasn’t met for over a year and served more as a photo opportunity than an actual working group–while photos were quick to emerge from the meetings, recommendations, reports and accomplishments never quite made it out. One member of the Council, Intel’s CEO Paul Otellini, didn’t exactly have much confidence in the president last year, as he publicly endorsed his Republican opponent Mitt Romney.

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It hasn’t been a good week in economic news. Earlier this week we learned that the GDP contracted. John Steele Gordon wrote at the time: “The GDP shrank in the last quarter of 2012, declining a small 0.1 percent. While that is minimal, it is the first negative quarter since the second quarter of 2009 and a sharp slowdown from the 3.1 percent growth in the third quarter.” Today he wrote about the disappointing jobs numbers, which showed low growth and a slightly higher unemployment rate. 

It’s interesting that this week, in light of all of this economic doom and gloom, that the Obama administration has decided to layoff its long-defunct Jobs Council, which was set to expire this week. Don’t worry about these layoffs, however, as the Council was composed of business and labor leaders–they all have day jobs to fall back on. The Council hasn’t met for over a year and served more as a photo opportunity than an actual working group–while photos were quick to emerge from the meetings, recommendations, reports and accomplishments never quite made it out. One member of the Council, Intel’s CEO Paul Otellini, didn’t exactly have much confidence in the president last year, as he publicly endorsed his Republican opponent Mitt Romney.

James Pethokoukis, a leading economics blogger for AEI, discussed the decision to close the Council yesterday, highlighting several charts that showcase why the mission to improve the employment picture is far from accomplished. As Pethokoukis shows, beyond the GDP and jobs numbers, there are a number of indicators that the economy is stagnating at best. What is inexplicable is why the Obama administration has decided to pivot from the precarious economic situation for millions of Americans to instead focus on immigration and gun control. 

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The Jobs Report

It’s another dreary jobs report out this morning from the Bureau of Labor Statistics, detailing yet another month of the apparently endless “Obama Recovery,” the worst since the Great Depression lingered on and on in the 1930s.

Employment rose by 155,000 and the unemployment rate stayed the same at 7.8 percent (the November unemployment rate, originally reported at 7.7 percent, was revised upwards a notch in this report). It’s not surprising that it stayed the same, as the civilian workforce rose by 192,000 last month. In other words, job growth is barely keeping pace with population growth. And part of the job growth is probably due to Hurricane Sandy, as 30,000 construction jobs were added in December, not ordinarily a good month for construction jobs.

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It’s another dreary jobs report out this morning from the Bureau of Labor Statistics, detailing yet another month of the apparently endless “Obama Recovery,” the worst since the Great Depression lingered on and on in the 1930s.

Employment rose by 155,000 and the unemployment rate stayed the same at 7.8 percent (the November unemployment rate, originally reported at 7.7 percent, was revised upwards a notch in this report). It’s not surprising that it stayed the same, as the civilian workforce rose by 192,000 last month. In other words, job growth is barely keeping pace with population growth. And part of the job growth is probably due to Hurricane Sandy, as 30,000 construction jobs were added in December, not ordinarily a good month for construction jobs.

Unemployment for blacks (14.0 percent) and teenagers (23.5 percent) remained dismal, as did unemployment for those aged 18-29 at 11.5 percent. Long-term unemployment is stuck at 4.8 million, or 39.1 percent of all unemployed, and 7.9 million are working part-time although they would rather work full-time. The number of employed people as a percentage of the total population remains at 58.6, the same as it was a year ago. That is not exactly a sign of a recovery that is gathering steam.

Why is the dismal Obama recovery so much like the dismal Roosevelt recovery of the 1930s? Could it be because both presidents pursued the same policies—high taxes on high-income earners, greatly increased regulation on business, government “investment,” and redistribution of wealth? Yep, it could be.

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The Jobs Report

The unemployment rate fell to 7.7 percent from 7.9 in October, and 146,000 jobs were added to the economy. But the first number is from the Household Survey data and the second from the Establishment Survey data. As usual in this economy, the two surveys tell different stories.

According to the Household Survey, the number of unemployed remained about the same, at 12 million, and long-term unemployed made up 40.1 percent of total unemployed, both dismal numbers. Equally dismal was the number of underemployed, working part-time jobs but wanting full-time work, at 8.2 million.

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The unemployment rate fell to 7.7 percent from 7.9 in October, and 146,000 jobs were added to the economy. But the first number is from the Household Survey data and the second from the Establishment Survey data. As usual in this economy, the two surveys tell different stories.

According to the Household Survey, the number of unemployed remained about the same, at 12 million, and long-term unemployed made up 40.1 percent of total unemployed, both dismal numbers. Equally dismal was the number of underemployed, working part-time jobs but wanting full-time work, at 8.2 million.

Again the participation rate (the percentage of working-age adults in the labor force) declined, to 63.6 percent, accounting for most of the decline in the unemployment number. The baby boomers retiring at the rate of 10,000 a day is the only thing that is keeping the numbers from being even more dismal than they are.

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Re: The Jobs Report

As John Steele Gordon noted, the unemployment rate ticked up slightly last month, but it’s still just below 8 percent — a psychological barrier that would have certainly hurt Obama days before the election. Still, it’s important to remember where we were supposed to be at this point, at least according to the Obama administration’s 2009 estimates that were used to sell the stimulus package to the public. Jim Pethokoukis writes

Back in early 2009, White House economists Christina Romer and Jared Bernstein predicted the unemployment rate would be 5.2% in October 2012 if Congress passed the $800 billion stimulus. As the above chart shows, they weren’t even close.

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As John Steele Gordon noted, the unemployment rate ticked up slightly last month, but it’s still just below 8 percent — a psychological barrier that would have certainly hurt Obama days before the election. Still, it’s important to remember where we were supposed to be at this point, at least according to the Obama administration’s 2009 estimates that were used to sell the stimulus package to the public. Jim Pethokoukis writes

Back in early 2009, White House economists Christina Romer and Jared Bernstein predicted the unemployment rate would be 5.2% in October 2012 if Congress passed the $800 billion stimulus. As the above chart shows, they weren’t even close.

Click above for the chart, which, as Pethokoukis notes, isn’t even close. In fact, their estimates of what the unemployment rate would look like without the stimulus is much lower than our current rate. 

According to Fox News, we might be waiting a long time for the numbers the White House predicted:

The October numbers allow President Obama to argue the economy is technically growing under his watch. But they also allow Mitt Romney to argue that the new jobs are not making much of a dent in the unemployment problem. Both campaigns quickly set to work putting their spin on data that, if nothing else, underscores the slow pace of the recovery. 

Former Bureau of Labor Statistics chief Keith Hall told Fox Business Network that at this rate, “we’re still talking nine or 10 years” before the economy gets back to normal.

Remember when Obama said he could get it done in three, otherwise it would be a “one-term proposition”? Now we’re told even if he’s reelected not to expect the economy to bounce back until well after he’s out of office. How’s that for accountability?

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The Jobs Report

The last jobs report before the election came in at 8:30 this morning. It showed a net gain of 171,000 jobs and an uptick in the unemployment rate to 7.9 percent from 7.8 last month.

These numbers are unlikely to impact the election significantly. The job growth is still not big enough to bring down the unemployment rate, at least not quickly, but it remains job growth. President Obama can claim progress. The unemployment rate did not go back above 8 percent, as some thought might happen after last month’s unexpected .3 percent drop. But it did rise a little. That’s not good news for the president.

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The last jobs report before the election came in at 8:30 this morning. It showed a net gain of 171,000 jobs and an uptick in the unemployment rate to 7.9 percent from 7.8 last month.

These numbers are unlikely to impact the election significantly. The job growth is still not big enough to bring down the unemployment rate, at least not quickly, but it remains job growth. President Obama can claim progress. The unemployment rate did not go back above 8 percent, as some thought might happen after last month’s unexpected .3 percent drop. But it did rise a little. That’s not good news for the president.

So this report simply reflects the economy as it has been under this president since the recovery began in June 2009: sluggish at best. But that’s not news and therefore won’t have an impact.

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Re: The Jobs Numbers

The White House spins today’s grim August jobs report (which John Steele Gordon details below), calling it “further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression”:

While there is more work that remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression. It is critical that we continue the policies that are building an economy that works for the middle class as we dig our way out of the deep hole that was caused by the severe recession that began in December 2007. To create more jobs in particularly hard-hit sectors, President Obama continues to support the elements of the American Jobs Act that have not yet passed, including further investment in infrastructure to rebuild our Nation’s ports, roads and highways, and assistance to State and local governments to prevent layoffs and to enable them to rehire hundreds of thousands of teachers and first responders. To build on the progress of the last few years, President Obama has also proposed an extension of middle class tax cuts that would prevent the typical middle class family from facing a $2,200 tax increase next year.

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The White House spins today’s grim August jobs report (which John Steele Gordon details below), calling it “further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression”:

While there is more work that remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression. It is critical that we continue the policies that are building an economy that works for the middle class as we dig our way out of the deep hole that was caused by the severe recession that began in December 2007. To create more jobs in particularly hard-hit sectors, President Obama continues to support the elements of the American Jobs Act that have not yet passed, including further investment in infrastructure to rebuild our Nation’s ports, roads and highways, and assistance to State and local governments to prevent layoffs and to enable them to rehire hundreds of thousands of teachers and first responders. To build on the progress of the last few years, President Obama has also proposed an extension of middle class tax cuts that would prevent the typical middle class family from facing a $2,200 tax increase next year.

At the AEI blog, James Pethokoukis cites a far less optimistic take from Citigroup:

The unemployment rate dropped to 8.1% from 8.3%, but in this case with declines in both the labor force (-368,000) and the household-survey measure of employment (-119,000). With labor force participation falling back to a new cycle low of 63.5%, the drop in the unemployment rate should not be reported as good news.

Pethokoukis adds:

This was not the employment report either American workers or the Obama campaign were hoping for. A huge miss. It shows the U.S. labor market remains in a deep depression, generating few jobs and little if no income growth.

No amount of spin from the White House or Obama campaign can put a happy face on these numbers. While the unemployment rate dipped from 8.3 percent in July to 8.1 percent, Pethokoukis notes that the unemployment rate would actually be 8.4 percent if workforce participation had remained steady from July. The fact that many unemployed Americans have given up looking for jobs over the past month is obviously a distressing sign, even though it may have made the unemployment rate look modestly better on the surface.

Meanwhile, the Romney campaign jumped on the numbers this morning to contrast them with the positive recovery rhetoric from the Democratic National Convention: “If last night was the party, this morning is the hangover.”

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Will Obama Play Politics With Sequester Report Deadline?

The White House is required to release a report this week detailing how the sequestration cuts to defense actually will be executed. The outline — which will help shape 2013 budget and employment decisions for the Pentagon and defense industry — was initially supposed to be released today, according to multiple reports and the Bipartisan Policy Center. Of course, that would almost certainly have conflicted with Obama’s attempts to play up his national security record at the convention — so it’s no surprise it’s nowhere to be found on the OMB website this afternoon.

“On and off the Hill, many suspect the Obama Administration will quietly drop the sequestration transparency report on Friday in close-of-business ‘data dump’ with little fanfare, perhaps sending the report only to House and Senate leadership,” said Robert Zarate, policy director at the Foreign Policy Initiative. “But once the report gets to the Hill, you can expect lawmakers on both sides of the sequestration debate to start aggressively posturing and messaging.”

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The White House is required to release a report this week detailing how the sequestration cuts to defense actually will be executed. The outline — which will help shape 2013 budget and employment decisions for the Pentagon and defense industry — was initially supposed to be released today, according to multiple reports and the Bipartisan Policy Center. Of course, that would almost certainly have conflicted with Obama’s attempts to play up his national security record at the convention — so it’s no surprise it’s nowhere to be found on the OMB website this afternoon.

“On and off the Hill, many suspect the Obama Administration will quietly drop the sequestration transparency report on Friday in close-of-business ‘data dump’ with little fanfare, perhaps sending the report only to House and Senate leadership,” said Robert Zarate, policy director at the Foreign Policy Initiative. “But once the report gets to the Hill, you can expect lawmakers on both sides of the sequestration debate to start aggressively posturing and messaging.”

According to House Speaker John Boehner’s office, the absolute deadline for the report is tomorrow, but there’s a chance Obama may delay it further.

“Tomorrow (September 7) is the deadline, which has us wondering…will President Obama comply with the Sequestration Transparency Act he signed into law?” asked Don Seymour, digital communications director for Boehner, in an email blast. “The administration has repeatedly ignored requests from Congress for ‘sequester’ information, even as top officials admit the defense cuts the White House demanded – in an effort to ensure the president wouldn’t face another debt limit vote before the election – would jeopardize our national security.”

Meanwhile, DoD Buzz reports that the administration could actually end up dragging its feet for a couple of weeks:

The White House Office of Management and Budget is scheduled to release a detailed report specifying how sequestration cuts will affect the Pentagon after President Obama ordered the report in August. Capitol Hill sources expect to see the report in the next couple weeks.

Although Kendall tried to simplify the complexity of the cuts with simple arithmetic, the defense industry is eager to see what the OMB report will contain. Defense Secretary Leon Panetta has told Congress the military has done minimal planning because of the simplicity of the across the board cut.

The impact of the cuts should be clearer once the report comes out, assuming the Office of Management and Budget provides sufficient detail. President Obama may not want this to drop the week of his convention, but the targeted industries and the general public deserve to see the specifics by the required deadline.

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Defense Cuts Would Spike Unemployment

There’s no question the automatic budget cuts set to take place next January will have major national security implications, but what about the economic fallout? Sequestration doesn’t just mean a reduction in military readiness, it also means reductions in defense and non-defense jobs. According to a new study by the Aerospace Industries Association, the unemployment rate would reach 9 percent or higher under these cuts (h/t Rob Bluey):

“The results are bleak but clear-cut,” said [Dr. Stephen S.] Fuller. “The unemployment rate will climb above 9 percent, pushing the economy toward recession and reducing projected growth in 2013 by two-thirds. An already weak economy will be undercut as the paychecks of thousands of workers across the economy will be affected from teachers, nurses, construction workers to key federal employees such as border patrol and FBI agents, food inspectors and others.”

The analysis concludes that the automatic spending cuts mandated in the Budget Control Act of 2011 affecting defense and non-defense discretionary spending in just the first year of implementation will reduce the nation’s GDP by $215 billion; decrease personal earnings of the workforce by $109.4 billion and cost the U.S. economy 2.14 million jobs.

This is about more than national security. A sudden reduction in defense-sector jobs could devastate whole communities, flooding the already-oversaturated job market with masses of newly unemployed. These aren’t unnecessary or obsolete jobs, they’re ones that are still critical for national defense.

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There’s no question the automatic budget cuts set to take place next January will have major national security implications, but what about the economic fallout? Sequestration doesn’t just mean a reduction in military readiness, it also means reductions in defense and non-defense jobs. According to a new study by the Aerospace Industries Association, the unemployment rate would reach 9 percent or higher under these cuts (h/t Rob Bluey):

“The results are bleak but clear-cut,” said [Dr. Stephen S.] Fuller. “The unemployment rate will climb above 9 percent, pushing the economy toward recession and reducing projected growth in 2013 by two-thirds. An already weak economy will be undercut as the paychecks of thousands of workers across the economy will be affected from teachers, nurses, construction workers to key federal employees such as border patrol and FBI agents, food inspectors and others.”

The analysis concludes that the automatic spending cuts mandated in the Budget Control Act of 2011 affecting defense and non-defense discretionary spending in just the first year of implementation will reduce the nation’s GDP by $215 billion; decrease personal earnings of the workforce by $109.4 billion and cost the U.S. economy 2.14 million jobs.

This is about more than national security. A sudden reduction in defense-sector jobs could devastate whole communities, flooding the already-oversaturated job market with masses of newly unemployed. These aren’t unnecessary or obsolete jobs, they’re ones that are still critical for national defense.

The Obama administration and Congress may not be able to avoid dealing with this issue for long. As Dov Zakheim wrote last month at Foreign Policy, employers will be required to inform their employees of the possible termination 60 days before the sequester goes into effect — which just so happens to be Nov. 2, 2012:

 In addition to its impact on the government’s budget, the sequester will also trigger the WARN Act, which requires employers to give a minimum of sixty days notice to private and public sector employees whose jobs are being targeted for possible termination. Those politicians seeking re-election to national office should take note that Nov. 2, 60 days before Jan. 2, when the sequester comes into force, is just four days before election day. They may find it very uncomfortable having to explain to potentially hundreds of thousands of people who have been given WARN Act pink slips why they deserve to be returned to office after they did nothing about the sequester.

Can you imagine massive layoff warnings a week before the election? How has the Obama administration failed to address this issue so far?

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Obama’s Excuses Are Getting Weaker

President Obama’s response to the latest dismal federal jobs report was as predictable as it was weak. Speaking on his bus tour of Ohio, he repeated the theme we’ve heard so often since January 2009: It’s not his fault. Only this time he not only heaped blame on the administration of his predecessor but also claimed the problems dated to the Clinton administration, which heretofore Democrats have spoken of as a golden age of prosperity:

“We’ve got to deal with what’s been happening over the last decade, the last 15 years.”

It’s not clear what event it was that happened in 1997 — when his secretary of state was serving as First Lady and President Obama had just begun his first term in the Illinois State Senate — whose impact was so far-reaching that even today the administration is helpless to ameliorate its effects. But whatever it was that the president had in mind when he threw out this puzzling alibi, blaming Bill Clinton is about as pointless as pointing the finger at George W. Bush, Obama’s usual punching bag. But the way things are going for the president, one more bad jobs report and he may be blaming the elder President Bush as well his son and  Clinton for all of his troubles.

As even a liberal stalwart like Robert Reich pointed out today at the Huffington Post, the excuse that he inherited the worst economy since the Great Depression is “wearing thin.” In fact, it has already worn out, a fact made all too clear by the president’s obfuscations about the jobs numbers that Reich was honest enough to report.

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President Obama’s response to the latest dismal federal jobs report was as predictable as it was weak. Speaking on his bus tour of Ohio, he repeated the theme we’ve heard so often since January 2009: It’s not his fault. Only this time he not only heaped blame on the administration of his predecessor but also claimed the problems dated to the Clinton administration, which heretofore Democrats have spoken of as a golden age of prosperity:

“We’ve got to deal with what’s been happening over the last decade, the last 15 years.”

It’s not clear what event it was that happened in 1997 — when his secretary of state was serving as First Lady and President Obama had just begun his first term in the Illinois State Senate — whose impact was so far-reaching that even today the administration is helpless to ameliorate its effects. But whatever it was that the president had in mind when he threw out this puzzling alibi, blaming Bill Clinton is about as pointless as pointing the finger at George W. Bush, Obama’s usual punching bag. But the way things are going for the president, one more bad jobs report and he may be blaming the elder President Bush as well his son and  Clinton for all of his troubles.

As even a liberal stalwart like Robert Reich pointed out today at the Huffington Post, the excuse that he inherited the worst economy since the Great Depression is “wearing thin.” In fact, it has already worn out, a fact made all too clear by the president’s obfuscations about the jobs numbers that Reich was honest enough to report.

Though the president preferred to take a “glass half full” approach to the jobs numbers, as the New York Times delicately described his rhetoric, Reich was more frank about Obama’s excuses. Far from the creation of 84,000 new jobs being a hopeful sign, the truth is very different:

Remember, 125,000 new jobs are needed just to keep up with the increase in the population of Americans who need jobs. That means the jobs situation continues to worsen.

After a good week in the aftermath of the Supreme Court’s ObamaCare decision that led to more focus on Mitt Romney’s weaknesses, the jobs report brought the president back to the reality of a sinking economy that, as even Reich pointed out, he owns. The voters don’t care what he inherited. After four years, the Bush alibi, not to mention the swipe at Clinton, isn’t fooling anyone.

Reich also stated the obvious when he noted that Obama hasn’t any real ideas about dealing with the crisis. Even worse for the president — and the country whose fiscal affairs he is steering into the ditch — at this point the European debt crisis and China’s economic slowdown are likely to only make things a lot worse before they get better. Democrats may hope voters aren’t paying attention to the election and economic statistics until Labor Day, but by then the president’s goose as well as the economy may already be cooked.

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Jobs Report Rains on Obama’s Bus Tour

The unemployment numbers in May were bad, but June showed no improvement, according to the jobs report released this morning. Just 80,000 jobs were added last month (economists expected 95,000 on the lower end of estimates), keeping the unemployment rate unchanged, via BLS.gov:

Nonfarm payroll employment continued to edge up in June (+80,000), and the unemployment rate was unchanged at 8.2 percent, the U.S. Bureau of Labor Statistics reported today. Professional and business services added jobs, and employment in other major industries changed little over the month.

The number of unemployed persons (12.7 million) was essentially unchanged in June, and the unemployment rate held at 8.2 percent. (See table A-1.)

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The unemployment numbers in May were bad, but June showed no improvement, according to the jobs report released this morning. Just 80,000 jobs were added last month (economists expected 95,000 on the lower end of estimates), keeping the unemployment rate unchanged, via BLS.gov:

Nonfarm payroll employment continued to edge up in June (+80,000), and the unemployment rate was unchanged at 8.2 percent, the U.S. Bureau of Labor Statistics reported today. Professional and business services added jobs, and employment in other major industries changed little over the month.

The number of unemployed persons (12.7 million) was essentially unchanged in June, and the unemployment rate held at 8.2 percent. (See table A-1.)

Economists had revised their initial estimates yesterday after some encouraging indications from ADP. The Wall Street Journal reported that the late estimate for June was around 100,000 new jobs — but obviously the reality fell far short.

The dismal numbers come as President Obama wraps up his jobs tour in the Rust Belt:

U.S. President Barack Obama is facing the release of a potentially weak jobs report from June as he wraps up a two-day campaign bus tour in Ohio and Pennsylvania Friday. …

Ohio and Pennsylvania are two crucial states in the November general election, both of which Mr. Obama carried in the 2008 election. The president is using the campaign swing to portray himself more like a champion of average, working-class Americans than his presumptive Republican opponent, Mitt Romney, a wealthy businessman before entering politics.

After last month’s jobs report, Obama lost ground in states like Michigan and Ohio, which means the numbers released today could counteract any benefit gained from his jobs tour this week.

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It’s Getting Late Early for Obama’s Economy

For some liberal political strategists, the focus on the monthly federal jobs report that will come out later this morning is much ado about not all that very much. The unemployment and job creation numbers are, they say, just statistics that don’t necessarily tell us all that much about the economy and perhaps even less about the sentiment of voters. To which the sensible observer can only respond: Like hell, they don’t.

The question about why we’re all so obsessed with economic statistics this summer was the conceit of a New York Times feature that served to preview the latest jobs report due out on the first Friday of every month. According to many of those quoted by the paper, the problem with the jobs numbers obsession is they aren’t a true measure of the worthiness of President Obama’s economic program. Their fear is that the latest report as well as those that preceded it and those that will follow in the coming months may merely reflect a caprice of fortune in which a few ill-timed economic statistics can ruin the chances of an otherwise praiseworthy president to gain re-election. The experts consulted seem divided between those who think the predictive power of these stats is overrated and those who think they do mean a lot but aren’t necessarily fair to the president.

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For some liberal political strategists, the focus on the monthly federal jobs report that will come out later this morning is much ado about not all that very much. The unemployment and job creation numbers are, they say, just statistics that don’t necessarily tell us all that much about the economy and perhaps even less about the sentiment of voters. To which the sensible observer can only respond: Like hell, they don’t.

The question about why we’re all so obsessed with economic statistics this summer was the conceit of a New York Times feature that served to preview the latest jobs report due out on the first Friday of every month. According to many of those quoted by the paper, the problem with the jobs numbers obsession is they aren’t a true measure of the worthiness of President Obama’s economic program. Their fear is that the latest report as well as those that preceded it and those that will follow in the coming months may merely reflect a caprice of fortune in which a few ill-timed economic statistics can ruin the chances of an otherwise praiseworthy president to gain re-election. The experts consulted seem divided between those who think the predictive power of these stats is overrated and those who think they do mean a lot but aren’t necessarily fair to the president.

But this analysis misses the obvious. The numbers matter because they are the tangible measure of the success or failure of any administration in proving the country is in better shape than it was when they took over the big fancy offices in Washington after the last presidential election. If voters take these numbers seriously, it’s because along with personal experiences, they help form the voters’ overall impression of the state of the economy. The key here is not so much the details of each report as it is the trajectory of the nation’s finances. Moreover, given the fact that we are just four months away from the November election, it’s that point in time when, in the immortal words of Yogi Berra, politicians begin to understand that “it gets late early out there.” Once the electorate accepts the verdict that the economy is either on the decline or on the rise, a possible change in the fall (with the exception perhaps of a collapse on Wall Street such as occurred in September 2008) is unlikely.

If, as some economists think and worried Democrats fear, the jobs reports will continue to spread gloom, attempts to spin the statistics as either arbitrary or misleading won’t work. Nor will President Obama’s claim the economy has been recovering for three years on his watch. If three straight summers of recovery leave the country in worse shape than the president found it in January 2009, then the only arguments to be made for his re-election will revolve around the historic nature of his presidency and attempts to smear Republican candidate Mitt Romney. Though it will, as Bill Kristol rightly noted yesterday, take more than a bad economy to elect Romney, a president who can’t run on his record in the midst of an ongoing economic crisis isn’t likely to be re-elected.

President Obama will have to hope the July numbers will be kind to him and pray the first Friday of August and September will not do him more damage. But whether they help or hurt him, it’s no good for Democrats to pretend the sinking employment figures aren’t a fair measure of the administration’s competence.

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Our Government Jobs Addiction

The debate about the nation’s declining economy took an interesting turn this past week as liberals have begun arguing that cuts in public sector jobs are sinking any hopes of a recovery. That was the conceit of yesterday’s front-page story in the New York Times that claimed public worker layoffs are hurting the economy. This is an assertion that seems to contradict the focus of most public policy discussions in the past two years — especially during the debt ceiling crisis in 2011 — when most Democrats and Republicans agreed that government expenditures had to be cut and only differed over how much the size of the public payroll needed to be reduced. But with the Republican presidential candidate getting some traction by speaking out on the need to continue cutting back on the size of government, some liberals are pushing back and speaking not only about the cost to the public of cuts in services but also about the role of public sector jobs in inflating the country’s economic balloon.

In a limited sense, they are right, as the wages of government employees are part of the economy and when they disappear, it creates some unemployment as well as a decline in economic activity, not to mention pain for the families involved. But laments about these job cuts should not confuse us about the role the public sector plays in expanding the economy. Genuine growth, the sort of wealth creation that makes all the boats rise, comes from the private sector jobs, not government sinecures. Moreover, if the public schools and other government services are now to be merely seen as jobs programs, then the problems of our education system go a lot deeper than budget shortfalls.

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The debate about the nation’s declining economy took an interesting turn this past week as liberals have begun arguing that cuts in public sector jobs are sinking any hopes of a recovery. That was the conceit of yesterday’s front-page story in the New York Times that claimed public worker layoffs are hurting the economy. This is an assertion that seems to contradict the focus of most public policy discussions in the past two years — especially during the debt ceiling crisis in 2011 — when most Democrats and Republicans agreed that government expenditures had to be cut and only differed over how much the size of the public payroll needed to be reduced. But with the Republican presidential candidate getting some traction by speaking out on the need to continue cutting back on the size of government, some liberals are pushing back and speaking not only about the cost to the public of cuts in services but also about the role of public sector jobs in inflating the country’s economic balloon.

In a limited sense, they are right, as the wages of government employees are part of the economy and when they disappear, it creates some unemployment as well as a decline in economic activity, not to mention pain for the families involved. But laments about these job cuts should not confuse us about the role the public sector plays in expanding the economy. Genuine growth, the sort of wealth creation that makes all the boats rise, comes from the private sector jobs, not government sinecures. Moreover, if the public schools and other government services are now to be merely seen as jobs programs, then the problems of our education system go a lot deeper than budget shortfalls.

The argument about how much role government spending plays in keeping the economy afloat dates back to the Depression and the heyday of Keynesianism. However, the idea that the creation of such public sector jobs creates permanent or sustainable growth is the sort of belief system that sustains bankrupt banana republics, not the United States.

We can reasonably debate just how big government needs to be, and there are cogent arguments to be made that assert the necessity of public services and the problems created when they are axed. But to speak of the schools or other departments as entitlements or as places to shift the unemployed is to take us down a road in which the government is assuming an outsized role in both our lives and the economy and where the private sector is bound to be negatively affected. A society that depends on the government not to just provide for vital services but for employing an increasingly large percentage of adults is one unlikely to be capable of ever digging itself out of an economic hole.

Just as important, dependence on government employment growth means an ever expanding budget deficit that sinks the nation in debt and makes the investment and savings that generate private sector growth and wealth creation less likely. That statist pattern is what we expect to see in Third World countries, where corrupt elites keep unemployment artificially low with vast government jobs programs that are a dual purpose form of stimulus/corruption. Such thinking is not only bad economics it degrades the entire idea of government and ensures that public services will be badly implemented. We are currently a long way from that, but the day our leaders start looking to public sector jobs as a way of solving our unemployment problems, we will have taken the first step toward an addiction to a form of spending that is difficult to break.

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America’s Youth Aren’t Fine, Mr. President

During the last several months, the political classes have come to the realization that the level of student debt in the United States is reaching crisis level. Many have suggested that the burst of the student loan bubble will be more far-reaching and more damaging than the housing bubble that precipitated the Great Recession. This week, the Huffington Post linked to a new study from the Federal Reserve Bank of New York that showcased just how deep the student loan problem reaches:

  • Of the 241 million people in the United States who have a credit report with Equifax, approximately 15.4% — or 37 million — hold outstanding student loan debt.
  • The average outstanding student loan balance per borrower is $23,300. About one-quarter of borrowers owe more than $28,000; about 10% of borrowers owe more than $54,000. The proportion of borrowers who owe more than $100,000 is 3.1%, and 0.45% of borrowers, or 167,000 people, owe more than $200,000.
  • Borrowers between the ages of thirty and thirty-nine have the highest average outstanding student loan balances, at $28,500, followed by borrowers between the ages of forty and forty-nine, whose average outstanding balance is $26,000.
  • About 27% of the borrowers have past due balances, while the adjusted proportion of outstanding student loan balances that are delinquent equals 21%.

Many have put the blame on ballooning costs of public and private universities across the country. Christian Science Monitor reported this week that “between 1999 and 2009, tuition at public four-year colleges rose 73 percent on average, and tuition at private nonprofit colleges jumped 34 percent. In the same period, median family income fell by about 7 percent.”

For graduating high school seniors, the allure of a college degree isn’t what it once was. Obtaining a degree, after falling tens of thousands of dollars in debt, no longer guarantees job placement upon graduation. Is there an alternative?

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During the last several months, the political classes have come to the realization that the level of student debt in the United States is reaching crisis level. Many have suggested that the burst of the student loan bubble will be more far-reaching and more damaging than the housing bubble that precipitated the Great Recession. This week, the Huffington Post linked to a new study from the Federal Reserve Bank of New York that showcased just how deep the student loan problem reaches:

  • Of the 241 million people in the United States who have a credit report with Equifax, approximately 15.4% — or 37 million — hold outstanding student loan debt.
  • The average outstanding student loan balance per borrower is $23,300. About one-quarter of borrowers owe more than $28,000; about 10% of borrowers owe more than $54,000. The proportion of borrowers who owe more than $100,000 is 3.1%, and 0.45% of borrowers, or 167,000 people, owe more than $200,000.
  • Borrowers between the ages of thirty and thirty-nine have the highest average outstanding student loan balances, at $28,500, followed by borrowers between the ages of forty and forty-nine, whose average outstanding balance is $26,000.
  • About 27% of the borrowers have past due balances, while the adjusted proportion of outstanding student loan balances that are delinquent equals 21%.

Many have put the blame on ballooning costs of public and private universities across the country. Christian Science Monitor reported this week that “between 1999 and 2009, tuition at public four-year colleges rose 73 percent on average, and tuition at private nonprofit colleges jumped 34 percent. In the same period, median family income fell by about 7 percent.”

For graduating high school seniors, the allure of a college degree isn’t what it once was. Obtaining a degree, after falling tens of thousands of dollars in debt, no longer guarantees job placement upon graduation. Is there an alternative?

Yesterday, National Journal highlighted a recent study by the John J. Heldrich Center for Workforce Development at Rutgers University on the employment situation for high school graduates without any college background or plans. Some of their chilling findings:

Only three in 10 of these recent grads are employed full time, according to the study, which tracked the employment outcomes of 544 young people who graduated from high schools across the country between 2006 and 2011.

Only 16 percent of those who graduated during the recession (2009-2011) are employed full time, although nearly half are looking for work. A third are unemployed and 15 percent are working part time. One in six have left the labor market altogether.

Thirty-seven percent of students who graduated pre-recession (2006-2008) are employed full time, according to the report.

Nearly 90 percent of those surveyed said they were paid hourly. The average hourly wage was $7.50, only  a quarter more than the federal minimum wage. Three quarters of the jobs reported were temporary.

Today, less than 24 hours after National Journal’s piece on youth unemployment was published, President Obama said during a press conference that “the private sector is doing fine.” This statement may come as a shock to Americans when unemployment was assessed at 8.2% by the Bureau of Labor Statistics, the stock market is down 7% since April, and there is still no good news on the horizon for jobs either.

During the last election, Obama garnered 61 percent of the youth vote, compared to McCain’s 31 percent – the results were almost identical for the college educated and not. America’s young people, whom the Obama campaign is trying to whip into a frenzy in order to produce the support he saw in 2008, won’t buy the hype this time around. Every morning they wake up unemployed and in debt, every conversation they have with a classmate and peer affirms that they aren’t “fine.” The Obama White House can turn Republicans into student debt boogeymen, send emails from Sarah Jessica Parker inviting recipients over for dinner, and issue statements about gay marriage every day from now until November. The only issue that matters to America’s youth this election isn’t looking any better for the Obama campaign – it’s the economy stupid.

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Obama Is Simply Overmatched by Events

It’s difficult to overstate just how depressing May’s job report is – and how much damage it will inflict on President Obama’s chances for re-election.

It’s not simply that the unemployment rate rose from 8.1 percent to 8.2 percent, or that it’s remained above 8 percent for 40 consecutive months, or that in May we gained less than 70,000 new jobs. Nor is it simply the fact that in May the number of long-term unemployed (those jobless for 27 weeks and over) increased from 5.1 million to 5.4 million. Or that the average work week fell to 34.4 hours. Or that, as John points out,  March and April’s jobs reports were revised downward. Or that in May, stocks suffered through their worst month in two years.

All of this matters quite a lot, of course. But what’s particularly injurious to the president’s re-election prospects is that May was the worst economic month in what is turning out to be a very bad economic year. The trajectory of events is down, not up. The economy is slowing down. Consumer confidence is dropping. Virtually every economic indicator is getting worse, not better.

This would be very troubling news for any incumbent president – but for one who has virtually no achievements he can point to with pride, it is triply damaging. Whatever fault one wants to ascribe to Obama’s predecessor, and whatever excuses the president can dream up, what is now beyond any reasonable dispute is that Obama has no clue how to fix things. That is not a political judgment; it’s an empirical one.

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It’s difficult to overstate just how depressing May’s job report is – and how much damage it will inflict on President Obama’s chances for re-election.

It’s not simply that the unemployment rate rose from 8.1 percent to 8.2 percent, or that it’s remained above 8 percent for 40 consecutive months, or that in May we gained less than 70,000 new jobs. Nor is it simply the fact that in May the number of long-term unemployed (those jobless for 27 weeks and over) increased from 5.1 million to 5.4 million. Or that the average work week fell to 34.4 hours. Or that, as John points out,  March and April’s jobs reports were revised downward. Or that in May, stocks suffered through their worst month in two years.

All of this matters quite a lot, of course. But what’s particularly injurious to the president’s re-election prospects is that May was the worst economic month in what is turning out to be a very bad economic year. The trajectory of events is down, not up. The economy is slowing down. Consumer confidence is dropping. Virtually every economic indicator is getting worse, not better.

This would be very troubling news for any incumbent president – but for one who has virtually no achievements he can point to with pride, it is triply damaging. Whatever fault one wants to ascribe to Obama’s predecessor, and whatever excuses the president can dream up, what is now beyond any reasonable dispute is that Obama has no clue how to fix things. That is not a political judgment; it’s an empirical one.

Barack Obama may be well-intentioned. He may be a fine father. He may have an excellent jump shot. And he may be a first-rate community organizer. But as president, he is simply — and by now almost undeniably — overmatched by events. By Obama’s own standards – by what he said and by what he promised — he is a failure.

For Obama, that is a politically lethal conclusion for a majority of the American people to come to. They were well on their way to arriving at this conclusion before today. They’re now further along than they were. And soon, very soon, there will be no way to undo it.

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The Dismal May Employment Figures

Only 69,000 jobs were created in May, the worst number in a year, and far below what economists had been expecting (the consensus forecast was for about 150,000 new jobs). Meanwhile, the unemployment rate ticked up to 8.2 percent from 8.1. That’s the first actual increase in unemployment in 11 months. Stock market futures, already considerably down, plunged further with the news. Gold ticked up, and the ten-year bond fell to a record low of 1.46 percent (i.e., lend the federal government $1,000 and they will pay you a snappy $14.60 in interest per year).

The recovery, mediocre at best, has now appeared to stall, especially with jobs numbers for March and April revised downward (April’s were cut from 115,000 to 77,000, March’s from 154,000 to 143,000.) Europe’s numbers were even more dismal, with euro-zone unemployment now at 11 percent, the worst since the number was first calculated in 1995.

With Europe teetering on the edge of a financial meltdown, the head of the European Central Bank is telling political leaders to do something and do it now:

In a warning to political leaders, Mr. Draghi told members of the European Parliament on Thursday that the central bank is reaching the limits of its powers and now it is up to politicians to move quickly and decisively because the survival of the euro, the Continent’s common currency, is at stake. The structure of the currency union, he said, had become “unsustainable unless further steps are undertaken.”

These numbers are a disaster for the Obama re-election campaign. Indeed, unless they improve and improve soon, and unless European leaders take Lady Macbeth’s advice and screw their courage to the sticking place—not something for which European leaders have been noted of late—a year from now a Romney administration may be talking about the difficulty of dealing with the mess they inherited.

Only 69,000 jobs were created in May, the worst number in a year, and far below what economists had been expecting (the consensus forecast was for about 150,000 new jobs). Meanwhile, the unemployment rate ticked up to 8.2 percent from 8.1. That’s the first actual increase in unemployment in 11 months. Stock market futures, already considerably down, plunged further with the news. Gold ticked up, and the ten-year bond fell to a record low of 1.46 percent (i.e., lend the federal government $1,000 and they will pay you a snappy $14.60 in interest per year).

The recovery, mediocre at best, has now appeared to stall, especially with jobs numbers for March and April revised downward (April’s were cut from 115,000 to 77,000, March’s from 154,000 to 143,000.) Europe’s numbers were even more dismal, with euro-zone unemployment now at 11 percent, the worst since the number was first calculated in 1995.

With Europe teetering on the edge of a financial meltdown, the head of the European Central Bank is telling political leaders to do something and do it now:

In a warning to political leaders, Mr. Draghi told members of the European Parliament on Thursday that the central bank is reaching the limits of its powers and now it is up to politicians to move quickly and decisively because the survival of the euro, the Continent’s common currency, is at stake. The structure of the currency union, he said, had become “unsustainable unless further steps are undertaken.”

These numbers are a disaster for the Obama re-election campaign. Indeed, unless they improve and improve soon, and unless European leaders take Lady Macbeth’s advice and screw their courage to the sticking place—not something for which European leaders have been noted of late—a year from now a Romney administration may be talking about the difficulty of dealing with the mess they inherited.

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The Damaging Effects of Obamanomics

According to a recent Washington Post story,

The proportion of Americans in their prime working years who have jobs is smaller than it has been at any time in the 23 years before the recession, according to federal statistics, reflecting the profound and lasting effects that the downturn has had on the nation’s economic prospects.

By this measure, the jobs situation has improved little in recent years. The percentage of workers between the ages of 25 and 54 who have jobs now stands at 75.7 percent, just a percentage point over what it was at the downturn’s worst, according to federal statistics.

Before the recession the proportion hovered at 80 percent.

While the unemployment rate may be the most closely watched gauge of the economy in the presidential campaign, this measure of prime-age workers captures more of the ongoing turbulence in the job market. It reflects “missing workers” who have stopped looking for work and aren’t included in the unemployment rate.

During their prime years, Americans are supposed to be building careers and wealth to prepare for their retirement. Instead, as the indicator reveals, huge numbers are on the sidelines.

“What it shows is that we are still near the bottom of a very big hole that opened in the recession,” said Heidi Shierholz, an economist at the Economic Policy Institute, a left-leaning think tank.

The Post story goes on to point out that the percentage of prime-age men who are working is smaller now than it has been in any time before the recession, going all the way back to 1948, while the proportion of prime-age women is at a low not seen since 1988. A 50-year-old heating and AC technician from Alexandria, Virginia, was out of work in 2009 but found a job right away. He was laid off again about six months ago and, standing outside the Alexandria unemployment office, said it seems harder this time around.

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According to a recent Washington Post story,

The proportion of Americans in their prime working years who have jobs is smaller than it has been at any time in the 23 years before the recession, according to federal statistics, reflecting the profound and lasting effects that the downturn has had on the nation’s economic prospects.

By this measure, the jobs situation has improved little in recent years. The percentage of workers between the ages of 25 and 54 who have jobs now stands at 75.7 percent, just a percentage point over what it was at the downturn’s worst, according to federal statistics.

Before the recession the proportion hovered at 80 percent.

While the unemployment rate may be the most closely watched gauge of the economy in the presidential campaign, this measure of prime-age workers captures more of the ongoing turbulence in the job market. It reflects “missing workers” who have stopped looking for work and aren’t included in the unemployment rate.

During their prime years, Americans are supposed to be building careers and wealth to prepare for their retirement. Instead, as the indicator reveals, huge numbers are on the sidelines.

“What it shows is that we are still near the bottom of a very big hole that opened in the recession,” said Heidi Shierholz, an economist at the Economic Policy Institute, a left-leaning think tank.

The Post story goes on to point out that the percentage of prime-age men who are working is smaller now than it has been in any time before the recession, going all the way back to 1948, while the proportion of prime-age women is at a low not seen since 1988. A 50-year-old heating and AC technician from Alexandria, Virginia, was out of work in 2009 but found a job right away. He was laid off again about six months ago and, standing outside the Alexandria unemployment office, said it seems harder this time around.

“The economy is just really messed up right now,” he said.

Indeed it is.

Yesterday, we also learned that Americans’ confidence in the economy suffered the biggest drop in eight months. The Conference Board said that its Consumer Confidence Index now stands at 64.9, down from 68.7 in April. “Consumers were less positive about current business and labor market conditions, and they were more pessimistic about the short-term outlook,” said Lynn Franco, director of economic indicators at The Conference Board.

These are more signs (as if we needed them) that the economic recovery under Obama is historically weak. With a little more than five months left in the election, there’s nothing the president seems able to do about it. And the human suffering caused by his misguided policies continues to mount.

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Another Dismal Jobs Report

The monthly jobs report, released on the first Friday of every month, came out at 8:30 this morning, and it isn’t pretty. While the unemployment rate ticked down to 8.1 percent, that was largely because people dropped out of the workforce rather than people finding jobs. The broader measure of unemployment, which counts people in part-time jobs who would rather work full-time, remains at a dismal 14.5 percent. The percentage of the population in the workforce dropped to a 30-year low at 64.3 percent, as 522,000 people left the labor force.

Only 115,000 new jobs were created last month (130,000 in the private sector, while government lost 15,000 jobs) and, thanks to population growth, the country needs 125,000 new jobs a month just to keep the unemployment rate steady.

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The monthly jobs report, released on the first Friday of every month, came out at 8:30 this morning, and it isn’t pretty. While the unemployment rate ticked down to 8.1 percent, that was largely because people dropped out of the workforce rather than people finding jobs. The broader measure of unemployment, which counts people in part-time jobs who would rather work full-time, remains at a dismal 14.5 percent. The percentage of the population in the workforce dropped to a 30-year low at 64.3 percent, as 522,000 people left the labor force.

Only 115,000 new jobs were created last month (130,000 in the private sector, while government lost 15,000 jobs) and, thanks to population growth, the country needs 125,000 new jobs a month just to keep the unemployment rate steady.

This is the third year in a row that job growth, after a promising start in the early months of the year, stalled in the spring. But this isn’t any year. It’s a year divisible by 4. In six months, President Obama has to face an electorate that has lived through the most sluggish recovery since the Great Depression lingered on and on in the 1930’s. And Obama is no FDR (nor does Mitt Romney have anything in common with Alf Landon except party registration).

 

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America’s Slowing Economy

Yesterday, the U.S. Census Bureau and the Department of Housing and Urban Development announced that seasonally-adjusted annual rate of sales fell 7.1 percent from February. The March figures for home sales were the lowest in four months. Today, we learned that new orders for manufactured durable goods in March decreased $8.8 billion — or 4.2 percent — to $202.6 billion. And this comes after a jobs report that showed in March we produced only 120,000 new jobs, as more and more people continued to drop out of the labor force.

As this McClatchy Newspaper story puts it:

Rather than a breakout surge in economic growth, mainstream forecasters say, Americans should expect the U.S. economy to slog forward for another couple of years.

The economy grew at a subpar annual rate of 1.7 percent last year, down from 3 percent the year before. The consensus forecast for this year now is for growth of 2 to 2.5 percent.

The U.S. economy is expected to slow later this year… A spate of recent indicators punctuated fears that the economy is stalling. March delivered only 120,000 new jobs, and the latest manufacturing and real estate data softened.

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Yesterday, the U.S. Census Bureau and the Department of Housing and Urban Development announced that seasonally-adjusted annual rate of sales fell 7.1 percent from February. The March figures for home sales were the lowest in four months. Today, we learned that new orders for manufactured durable goods in March decreased $8.8 billion — or 4.2 percent — to $202.6 billion. And this comes after a jobs report that showed in March we produced only 120,000 new jobs, as more and more people continued to drop out of the labor force.

As this McClatchy Newspaper story puts it:

Rather than a breakout surge in economic growth, mainstream forecasters say, Americans should expect the U.S. economy to slog forward for another couple of years.

The economy grew at a subpar annual rate of 1.7 percent last year, down from 3 percent the year before. The consensus forecast for this year now is for growth of 2 to 2.5 percent.

The U.S. economy is expected to slow later this year… A spate of recent indicators punctuated fears that the economy is stalling. March delivered only 120,000 new jobs, and the latest manufacturing and real estate data softened.

We’re already experiencing the weakest economic recovery since after World War II — and the latest data points to a further slowdown.

No wonder the president’s campaign would rather talk about contraception, Warren Buffett’s secretary, and the Irish setter Mitt Romney owned 30 years ago.

 

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Youth Prefer Jobs to Hope and Change

The president is having a hard time rounding up the support of young people to generate enthusiasm and votes for his reelection campaign, no doubt because this time around, he’s forced to run on his record, verses vague promises of “hope” and “change.” In 2008, young voters constituted a full fifth of his support, but this time around less than half of Americans between the ages of 18 and 24 plan to vote in November and only 40 percent are even registered to do so currently. Young Americans certainly have more time on their hands this time around, with 1 in 2 new graduates unemployed or underemployed in jobs that don’t utilize their education background. Too bad for Obama that it doesn’t seem they will be using that time to campaign for another four years of his economy.

How has the president tried to get on the good side of young voters? This week Obama and Biden have made tours of colleges in swing states touting a plan to prevent a doubling of interest rates for students who take out federally funded Stafford loans (despite not even bothering to be present for the 2007 vote). The plan wouldn’t help Americans already paying off student loans, nor would it help those who took loans from private institutions. How many students will this plan actually help? Very few. Like many other lofty presidential plans, however, the most important part is merely the optics – actual results are just a bonus. I’ve written previously on the $1 trillion student loan bubble, and unfortunately, the program being touted by the White House will probably do more harm than good.

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The president is having a hard time rounding up the support of young people to generate enthusiasm and votes for his reelection campaign, no doubt because this time around, he’s forced to run on his record, verses vague promises of “hope” and “change.” In 2008, young voters constituted a full fifth of his support, but this time around less than half of Americans between the ages of 18 and 24 plan to vote in November and only 40 percent are even registered to do so currently. Young Americans certainly have more time on their hands this time around, with 1 in 2 new graduates unemployed or underemployed in jobs that don’t utilize their education background. Too bad for Obama that it doesn’t seem they will be using that time to campaign for another four years of his economy.

How has the president tried to get on the good side of young voters? This week Obama and Biden have made tours of colleges in swing states touting a plan to prevent a doubling of interest rates for students who take out federally funded Stafford loans (despite not even bothering to be present for the 2007 vote). The plan wouldn’t help Americans already paying off student loans, nor would it help those who took loans from private institutions. How many students will this plan actually help? Very few. Like many other lofty presidential plans, however, the most important part is merely the optics – actual results are just a bonus. I’ve written previously on the $1 trillion student loan bubble, and unfortunately, the program being touted by the White House will probably do more harm than good.

The president has, on numerous occasions, promoted the importance of making college more affordable so that more Americans can have access to higher education. In 2010, he held a “Summit on Community Colleges” where Vice President Biden’s personal connection was highlighted:

As a lifelong educator and community college instructor for the past 17 years, Dr. [Jill] Biden knows that community colleges are uniquely positioned to graduate more Americans with the skills that businesses and the economy will need to compete in the 21st century.

While President Obama continues to pour taxpayer money into government grants and loans, further escalating the student loan crisis, these 1 in 2 unemployed or underemployed Americans with college degrees have got to be wondering why they’ve bothered. Yahoo News reports,

According to government projections released last month, only three of the 30 occupations with the largest projected number of job openings by 2020 will require a bachelor’s degree or higher to fill the position — teachers, college professors and accountants.

This graduating class of Americans has a sense of entitlement unlike any previous generation. They fill their teen years with extracurricular activities instead of after-school jobs, they expect to go to the college of their choice and demand government grants and loans to pay their way, and upon graduation are shocked to learn that their Creative Writing degree with a minor in Gender Studies doesn’t automatically qualify them for a well-paid job writing creatively about gender.

It’s time for the president to state some uncomfortable truths: America cannot, and should not, be spending its resources on giving money to universities that raise tuition at three times the rate of inflation, encouraging even more student debt. Why do we teach our children that college is not only a necessity, but also an entitlement? Why is a generation of liberal arts majors languishing in unemployment, leeching off their parents while blue-collar jobs go unfilled?

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