While we waited this morning for the Bureau of Labor Statistics’ latest jobs report, one of the big questions was, “Did the economy added or lost jobs in the month of August?” The answer, apparently, was, “Neither.”
For the first time in six decades, the U.S. simply broke even — no jobs were lost in the overall economy, and no jobs were gained. The unemployment rate held steady at 9.1%.
The private sector gained 17,000 jobs in August, while the public sector lost 17,000 jobs due entirely to budget cuts at the state and local level.
It’s worth noting that the figures are skewed a bit by the Verizon strike, which has since been resolved. The labor dispute temporarily subtracted 45,000 jobs from the economy, so when that’s taken into consideration, the overall economy actually added 45,000 jobs in August, which was roughly in line with expectations.
But that’s cold comfort in the midst of a prolonged jobs crisis. Just to keep up with population growth, the economy should be adding over 150,000 jobs a month. To bring down the unemployment rate quickly, we’d look for 300,000 jobs a month or more. This report reinforces the impression that the economy is just stalled, waiting for someone to give it a boost.
It’s a boost, of course, that congressional Republicans are desperate to prevent.
Making matters slightly worse, the revised totals from June and July were both revised downwards.
August, to be sure, was a brutal month all around. Wall Street took wild swings; Republican antics led to a downgrade in U.S. debt; the European debt crisis intensified, etc. The fact that hiring effectively halted in the month is not shocking.
But it is painful, and serves as yet another wake-up call to anyone who’ll listen: we have a jobs crisis, not a deficit crisis. If our political system were in any way sane, elected leaders would look at these numbers and conclude that the economy desperately needs an immediate jolt. Job creation should be the first, and arguably only, priority on the minds of policymakers.
And with that, here’s the homemade chart I run on the first Friday of every month, showing monthly job losses since the start of the Great Recession. The image makes a distinction — red columns point to monthly job totals under the Bush administration, while blue columns point to job totals under the Obama administration.