(photo: Fibonacci Blue)
As expected, the Labor Department announced the largest job gain in three years today, with 162,000 additional jobs in March. The consensus number was 190,000, so this ended up a bit below expectations. However, despite the growth, the unemployment rate remained static at 9.7%, as more people re-entered the job market in the favorable economic climate.
The Bureau of Labor Statistics estimates that 48,000 of those hires came from the US Census for short-term jobs related to the decennial count. However, they saw an increase of 123,000 private sector jobs, much more than the disappointing ADP report from earlier this week, which showed a slight decrease.
This paragraph from the BLS report shows why even growth numbers like this fail to move the needle on the unemployment rate:
In March, the number of unemployed persons was little changed at 15.0 million, and the unemployment rate remained at 9.7 percent.
Among the major worker groups, the unemployment rates for adult men (10.0 percent), adult women (8.0 percent), teenagers (26.1 percent), whites (8.8 percent), blacks (16.5 percent), and Hispanics (12.6 percent) showed little or no change in March. The jobless rate for Asians was 7.5 percent, not seasonally adjusted.
The number of long-term unemployed (those jobless for 27 weeks and over) increased by 414,000 over the month to 6.5 million. In March, 44.1 percent of unemployed persons were jobless for 27 weeks or more.
When you add in part-time workers who want full-time work, and those who have given up looking for work, that rate actually ticked up this month, to 16.9%, from 16.8%.
Without massive gains, like 200,000 or 300,000 a month, the number of people entering for the first time or re-entering the labor market cannot be completely offset, and the rate stays the same.
Both January and February got revised upward, with January nudging into positive territory at +14,000, and Februrary just below positive at -14,000. Overall, we’re clearly in better shape than we were at the same time a year ago, and the trend is positive. However, unemployment is still, in Tim Geithner’s words, “unacceptably high”, and will remain that way for a while without action. The Obama Administration’s own numbers don’t show the unemployment rate dipping below 9% this year.
Tula Connell writes:
Although the March report is a big improvement from the hundreds of thousands of jobs lost each month during 2009, job growth is effectively stalled and long-term unemployment is eating away at people’s pocketbooks and the nation’s economy. More than two in every five unemployed workers in this country have been unemployed for more than six months […]
Some 150,000 new jobs a month are needed just to keep pace with the growth in the labor force, and a stunning 11 million jobs must be generated to return to pre-recession employment levels. Yet there are more than six workers for every one job. Such massive numbers of new jobs aren’t going to materialize on their own.
The AFL-CIO is pushing the Local Jobs for America Act and other actions to kickstart hiring. The problem is that these kind of topline growth numbers create a sense of false security, an impression that the labor market is returning to normalcy and nothing else needs to be done. However, the real crisis of the long-term unemployed, and the big numbers needed to counteract the huge losses, actually means that no time is better for real action on the jobs front. Sadly, I don’t think that’s coming soon.
