Great news on jobs. From August to September, unemployment dropped from 6.1% to 5.9%, and 248,000 new jobs were created.
What a lucky break for Democrats, who can now run on these terrific new numbers (assuming that anyone is paying attention, as ISIS advances and ebola becomes a major health concern).
But are the numbers really as good as they look?
Well, let\’s start with unemployment itself. Here is a chart of unemployment data from 2001 to the present. Please pay special attention to the August-September period:
|
Year |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Oct |
Nov |
Dec |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
2001 |
4.2 |
4.2 |
4.3 |
4.4 |
4.3 |
4.5 |
4.6 |
4.9 |
5.0 |
5.3 |
5.5 |
5.7 |
|
2002 |
5.7 |
5.7 |
5.7 |
5.9 |
5.8 |
5.8 |
5.8 |
5.7 |
5.7 |
5.7 |
5.9 |
6.0 |
|
2003 |
5.8 |
5.9 |
5.9 |
6.0 |
6.1 |
6.3 |
6.2 |
6.1 |
6.1 |
6.0 |
5.8 |
5.7 |
|
2004 |
5.7 |
5.6 |
5.8 |
5.6 |
5.6 |
5.6 |
5.5 |
5.4 |
5.4 |
5.5 |
5.4 |
5.4 |
|
2005 |
5.3 |
5.4 |
5.2 |
5.2 |
5.1 |
5.0 |
5.0 |
4.9 |
5.0 |
5.0 |
5.0 |
4.9 |
|
2006 |
4.7 |
4.8 |
4.7 |
4.7 |
4.6 |
4.6 |
4.7 |
4.7 |
4.5 |
4.4 |
4.5 |
4.4 |
|
2007 |
4.6 |
4.5 |
4.4 |
4.5 |
4.4 |
4.6 |
4.7 |
4.6 |
4.7 |
4.7 |
4.7 |
5.0 |
|
2008 |
5.0 |
4.9 |
5.1 |
5.0 |
5.4 |
5.6 |
5.8 |
6.1 |
6.1 |
6.5 |
6.8 |
7.3 |
|
2009 |
7.8 |
8.3 |
8.7 |
9.0 |
9.4 |
9.5 |
9.5 |
9.6 |
9.8 |
10.0 |
9.9 |
9.9 |
|
2010 |
9.7 |
9.8 |
9.9 |
9.9 |
9.6 |
9.4 |
9.5 |
9.5 |
9.5 |
9.5 |
9.8 |
9.4 |
|
2011 |
9.1 |
9.0 |
9.0 |
9.1 |
9.0 |
9.1 |
9.0 |
9.0 |
9.0 |
8.8 |
8.6 |
8.5 |
|
2012 |
8.2 |
8.3 |
8.2 |
8.2 |
8.2 |
8.2 |
8.2 |
8.1 |
7.8 |
7.8 |
7.8 |
7.9 |
|
2013 |
7.9 |
7.7 |
7.5 |
7.5 |
7.5 |
7.5 |
7.3 |
7.2 |
7.2 |
7.2 |
7.0 |
6.7 |
|
2014 |
6.6 |
6.7 |
6.7 |
6.3 |
6.3 |
6.1 |
6.2 |
6.1 |
5.9 |
|
|
|
As you can see, other than in 2006, data from August and September barely move. Except for 2012 – a Presidential election year – and 2014 – the midterm election year we currently are in.
-In 2012, unemployment dropped from 8.1% to 7.8%. Wow, great move. And just in time for the elections. How fortuitous for Democrats.
-And now, in 2014, it drops from 6.1% to 5.9%. Ditto
Is it possible that this is just happenstance? Frankly, yes it is. Unemployment, albeit way too slowly, has been trickling down for years. So maybe the good timing for Democrats is just a coincidence. But this being the Obama administration? I have to admit I\’m suspicious.
And then we have the reasons that unemployment rate has dropped.
Under Obama, workplace participation – i.e. the percentage of people who are either working or looking for work – had dropped to a 36 year low. When people stop looking for work, they don\’t count in the unemployment data. So, in a perverse way, the lousier the job market is, the better the unemployment rate will look.
Next, we have this unsavory taste of reality, from Tyler Durden\’s analysis at zerohedge.com:
…155.9million. That is the civilian labor force number forSeptember and it compares to 154.9 million reported for October2008 way back when the financial crisis was just erupting. Thereason that rather tepid gain of 1 million labor force participantsover the course of six years is important is that during the sameperiod the working age civilian population (over 16 years) rosefrom 234.6 million to 248.4 million – or by 14 million in roundterms.
That\’sright, the labor force grew by only 7% of the gain in adultpopulation. That explains, of course, why the labor forceparticipation rate of 66.0% back at the time of the crisis hasplunged to a 36-year low of 62.7% in September. Orto put it another way, the employment-to-population ratio of 59.0%last month compared to just under 62% six years ago and 64.2% in theyear 2000.
Still think the economic news is so great?
Finally, there is the quality of those 248,000 new jobs. What kind of jobs are they?
In point of fact, a disproportionate percentage of the new job creation is low paying and part-time – a factor that has depressed real employment in this country for years – and which, undoubtedly it seems to me, is tied to the fact that ObamaCare kicks in when employees work 30 or more hours a week, so it is advantageous for employers to hire part-time instead of full-time.
So be sure to pay full attention as Democrats spend the next month trumpeting what terrific shape the economy is in, and how President Obama has so successfully brought us to prosperity. And join me in gritting your teeth, because we both know better.
