“The jobs recovery has taken a step backward,” – Patrick O’Keefe, former deputy assistant secretary for the Labor Department.
While the Obama administration downplays the seriousness of the May jobs report, drilling into the numbers shows a much bleaker jobs situation and trend than the President would like to admit. A situation even darker for the 81,000 additional Americans that were unable to find gainful employment last month.
The Bureau of Labor Statistics released its monthly employment situation report this morning and revealed that only 69,000 jobs were added to the struggling economy in May. That is far less than the 115,000 initially reported for April and far worse than the almost a quarter-of-a-million jobs created in both January and February.
According to economists, at least 150,000 new jobs must be added to meet the number of new entrants into the workforce to improve the employment situation. For each month where new job creation falls below that mark, the difference represents more Americans unable to find work.
The chart (top left) illustrates the growing chasm between the number of new workers looking for work and the number of jobs being added to the economy.
In May, just 69,000 non-farm payroll jobs were added, that leaves 81,000 new workers without the possibility of finding a job. In 11 of the past 17 months (going back to January 2011), there have not been enough jobs created to handle the additional workers entering the labor force, much less to allow the 13 million Americans already out-of-work. This results in a heavily-negative employment climate for the majority of the last year-and-a-half.
We used a period starting in 2011 to give Obama’s policies enough time to take hold and show improvement in the economy. Taking 2009 and 2010 out of the analysis should show whether President Obama has been able to at least improve on the economic situation he blames on the Bush administration or if his policies are ineffective. Even taking out those early years of his term, the numbers are staggeringly negative and point to an administration that has failed to put Americans back to work.
Todd Schoenberger, managing principal The BlackBay Group said, “It’s painfully obvious the economic recovery in the U.S. isn’t just slowing down, it’s pulling up the emergency brake.”
For those that are employed, “their spending power is sliding when accounting for inflation.” he added.
As was noted in USAToday, the May report held other bad news:
Also worrisome: the average workweek fell to 34.4 hours from 34.5 hours in April. That doesn’t bode well for additional hiring in the near term. Employers typically increase the hours of existing employees before hiring additional staff.
Considering the recent trends and more recent data, things are not looking up.
If the job gains (losses) are summed over the entire period of the analysis (chart left), the dire state of the American jobs situation is clear. The U.S. economy has shed almost 400,000 jobs in the most recent 17 months of the Obama presidency. It would seem that the further the country progresses through the Obama agenda, the worse the economy gets.