It’s the first Friday of the month and that means it’s Labor Report Day! As Kermit the Frog would say, “Yay!” I like to think of myself as an optimist. And actually, compared to my friends, I am Pollyanna. So I was looking forward to today, hoping (as always) that despite all the evidence, we would break through some invisible barrier and the economy would start to grow jobs. According to the Bureau of Labor Statistics (BLS), that did not happen today.
The economy created 113,000 jobs. That’s not very good. According to Dean Baker, the economy needs to create 90,000 jobs per month to keep even. That means, we gained 23,000 jobs in January. Given that we need very roughly ten million jobs to get up to full employment, it would take us 36 years.
Okay, I’m being silly there. January was not a typical month. But the numbers do put the state of the economy in perspective. The economy is growing at a snail’s pace. The most jobs created in a month last year was February with 280,000 jobs. This is a net of 190,000 jobs. Even at that rate, we are not looking at full employment for almost four and a half years. So this all looks very bleak.
Some are trying to put a positive spin on the numbers. “It’s the bad weather!” they say. But luckily, we have Dean Baker around to pour cold water on that idea:
The big problem with the idea that this winter is so much worse than the last is that it assumes the nation is New York. The weather certainly has been bad in the northeast this year. But it isn’t that much worse than last year. What’s more, at the same time, the west has been dry and warm. As a first order approximation, I’m sure that the extra work in the west offset the reduction in the east.
Even more disappointing than the new jobs number this month is that last month’s net job loss was only revised up by 1,000 jobs—so we lost a net of roughly 14,000 jobs in December. But who knows? Next month, we may see a major increase in in the estimates of both December and January. And in the end, that’s what makes the jobs report so great. By the time the numbers are finalized, we are two months on and fretting or celebrating new ones. Yay!