About Those Jobs Numbers

Monday, February 8, 2010 12:57 PM

The White House has been saying that the latest jobs numbers are "encouraging," but are they really?

Sure, numerically speaking, for the number to drop below 10% certainly is an improvement. But what does that really mean? The Washington Examiner has taken a closer look, and things are not as rosy:

First, the drop to 9.7 percent unemployment does not reflect the creation of new jobs that normally accompanies an economic recovery. The number of new jobs is actually declining. Total nonfarm payroll employment, for example, dipped by an additional 20,000 positions after a December decline of 150,000 positions. The unemployment rate the day Obama took office last year stood at 7.6 percent and 134.6 million people had jobs. When he signed the economic stimulus, Obama promised the bill would bolster the economy sufficiently to keep unemployment below 8.0 percent. But the unemployment rate has exceeded 8.0 percent since last fall, and total employment stands at only 129.5 million. The stimulus has been a bust.

Second, anybody who thinks the job situation is going to improve dramatically in coming months is not paying attention to what's going on behind the unemployment rate.The Hudson Institute's Diana Furchtgott-Roth notes that “This is a better employment report than last month’s report, yet the economy is still not creating jobs. The percent of the unemployed who are out of work for 27 weeks or more exceeded 41%, an all-time high. This is unacceptable and shows that Congress and the President need to focus on job creation, rather than on expanding government, because the tax increases and borrowing used to expand government reduce overall job creation and create uncertainty." Furchtgott-Roth further notes that "the labor force participation rate is the lowest since mid-1985." This means that fewer Americans are in the labor force.

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