April’s flaccid jobs report
We remain in the gravitational pull of the Great Recession. The Labor Department reports that 165,000 new jobs were created in April – below the average gains of 183,000 in the previous three months.
We can’t achieve escape velocity. Since mid-2010, the three-month rolling average of job gains hasn’t dipped below 100,000 but has exceeded 250,000 jobs just twice.
This isn’t enough to ease the backlog of at least 3 million (estimates range up to 8 million) job losses since 2007, just before the Great Recession began. (And as I’ll point out in a moment, 2007 wasn’t exactly jobs nirvana.)
Moreover, most of the new jobs now being created pay less than the ones that were lost.
First, government is doing exactly the opposite of what it should be doing. It raised payroll taxes in January (ending the temporary tax holiday), thereby reducing the incomes of the typical family by about $1,000 this year.
More damaging, government cut spending through the damnable sequester – thereby reducing overall demand for goods and services. (Direct government employment dropped another 11,000 in April.)