Doug Henwood on March employment numbers

Radio commentary, April 1, 2010

While the headline job gain of 162,000 looked pretty decent, especially after the huge declines of 2008 and early 2009, 30% of the gain came from temporary workers hired to conduct the Census, and another 25% came from temp firms in the private sector. So more than half the gain was in jobs designed not to last.

There were a few bright spots. Manufacturing added 17,000 workers, its third consecutive monthly gain—a sterling performance for a sector that lost jobs for 35 months in a row, and was in its own private recession for a dozen years. Manufacturing employment is now below where it was in 1941—not as a percentage of the total workforce, but in absolute numbers, a period when overall employment nearly quadrupled. (Manufacturing was over 30% of total employment then; now, it’s 9%.) Employment in bars and restaurants also grew, good news for the sybarites among us.

The unemployment rate held steady at a very high 9.7%, and the broadest measure of joblessness, the so-called U-6 rate, which takes account of people working part time who want full time work but can’t find it as well as those who’ve given up the job search as hopeless, rose 0.1 point to 16.8%, an extremely high number. The probability of a person unemployed in February finding a job in March fell below 20%, to an all-time low (and these numbers, using a technique borrowed from the economist Robert Shimer, go back to 1948).

Average earnings fell by 0.1%, before adjusting for inflation. Declines in wages are very rare, so despite the vaguely improving tone of the employment stats, the labor market continues to be very weak.

We’re in a deep hole, and it’s going to take a long time to get out of it.

Posted via email from Jim Nichols