Unemployment Rate Ticks Higher, But Private Sector Jobs Grow
This post originally appeared on the Washington Monthy.
Until the economy starts adding a significant number of jobs, the employment crisis will continue. And at this point, we're not even close to where we need to be.
That said, the monthly jobs report, published the first Friday of every month, actually exceeded expectations. By some measures, the U.S. economy was expected to lose 120,000 jobs in August, mostly as a result of government cutbacks and Census layoffs, with the private sector shedding about 10,000 jobs. The data from the Bureau of Labor Statistics wasn't good, but it was significantly better than everyone thought it would be.
With the American economic recovery showing clear signs of slowdown, private employers added 67,000 jobs in August, the Labor Department said on Friday. The number was more than forecast.
Over all, the nation lost 54,000 jobs in August, the agency said, as state and local governments, many of them grappling with severe budget deficits, cut 10,000 jobs last month. Another 114,000 temporary Census positions also came to an end. In all, governments cut 121,000 jobs last month.
The unemployment rate rose to 9.6 percent from 9.5 percent in July.
Of particular interest is the breakdown between the public and private sectors. It's the loss of public-sector jobs, mostly from the wind-down of the Census, that brings the overall total into the negative. But while the private sector was predicted in some corners to have lost jobs in August, it actually added 67,000, which is far short of where it needs to be, but is still a respectable number under the circumstances.
Indeed, we've now seen eight consecutive months of job growth in the private sector, a streak we haven't seen in a long while.
Also note, the job numbers for June and July were revised in a positive direction. While previous estimates showed the economy losing 221,000 jobs in June, the updated total was a loss of 175,000. In July, last month's reporting showed a loss of 131,000 jobs, while the revised total was a loss of 54,000.
To be clear, it's not my intention to sugarcoat the jobs report. The economy needs to be adding jobs -- lots of them -- right now, and as the chart below shows, the employment landscape's head is not yet above water. Just to keep up with population growth, the economy needs to add about 150,000 jobs a month. To bring down the unemployment rate, the figure would have to be about double. We're not even in the ballpark.
But for those looking for good news -- or at least less-bad news -- today's jobs report offers at least a glimmer of hope. Things aren't good, but nearly everyone expected them to be worse. (Dear Dems, don't use that as a campaign slogan.)
Once again, 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.