There’s not much else to say about the latest unemployment numbers, other than to feel sorry for anyone who still takes Obama and his spinmeisters seriously when they babble about “recovery” and how their brilliant long-term plans have left America “poised” for success. But there’s plenty to say about the efforts to spin this bad news away.
Even one of President Obama’s former economic advisers, Austan Goolsbee, called the March jobs report a “punch to the gut,” although he then remembered his talking points and absurdly tried to blame it on sequestration.
CNBC delivers the news in a concise package of gloom:
Job creation slowed to a crawl during March, with the U.S. economy creating just 88,0000 positions though the unemployment rate fell to 7.6 percent.
The number was a sharp slide from February’s upwardly revised 268,000.
The Labor Department reported Friday that nonfarm payroll growth eased amid hopes that the economy had begun to achieve the escape velocity needed for sustained growth.
Friday’s report fell short of economist expectations of 200,000 new jobs, confirming some of the weakness in recent reports.
Moreover, the drop in the jobless rate was little more than a statistical anomaly, with the labor-force participation rate tumbling to a 34-year low of 63.3 percent. However, a broader measure of unemployment that counts the discouraged and underemployed also fell, declining to 13.8 percent from February’s 14.3 percent.
The actual level of employment dropped by 206,000 and the number of Americans considered still in the labor force tumbled by 496,000.
This sort of thing is a standard feature of the Obama economy: anemic job creation – which occasionally bounces up to decent levels for a month or two – coupled with enormous workforce contractions, as discouraged job-seekers give up looking and exit the market. Very few of the small ticks downward in the unemployment rate over the past few years have been unaccompanied by workforce contractions. This time, job growth was astoundingly weak, and the workforce exodus was exceptionally large. You can tell it’s really bad because not even the most daring Administration flack or Obama apologist is attempting to claim that the tiny dip in the misleading U-3 unemployment rate is good news.
Obama Administration boilerplate slapped on every bad jobs report tells us not to read too much into a single job report, which is fair enough, but the long-term trends are impossible to square with his “happy days are here again” spin. Unemployment has been stuck at abnormally high levels throughout the Obama presidency. There is no natural reason it should still be over 7 percent, let alone kept at the level with workforce collapse that takes us back to Jimmy Carter levels. James Pethokoukis of the American Enterprise Institute pointed out via Twitter that job creation for the first quarter of 2013 was actually worse than the first quarter of 2012, and if the workforce was merely the same size it was one year ago, today’s U-3 unemployment rate would be 8.3 percent.
There has been some discussion of how demographics drive the workforce collapse – an aging population means fewer workers. But as Pethokoukis noted, the aging factor is not enough to explain it all, and at the other end of the employment scale, the youth unemployment rate is absolutely dismal. Generation Opportunity relates some harsh numbers:
- The youth unemployment rate for 18-29 year olds specifically for March 2013 is11.7 percent (NSA).
- The youth unemployment rate for 18-29 year old African-Americans for March 2013 is 20.1 percent (NSA); the youth unemployment rate for 18-29 year oldHispanics for March 2013 is 12.6 percent (NSA); and the youth unemployment rate for 18???29 year old women for March 2013 is 10 percent (NSA).
- The declining labor force participation rate has created an additional 1.7 million young adults that are not counted as “unemployed” by the U.S. Department of Labor because they are not in the labor force, meaning that those young people have given up looking for work due to the lack of jobs.
- If the labor force participation rate were factored into the 18-29 youth unemployment calculation, the actual 18-29-unemployment rate would rise to 16.2 percent (NSA).
Generation Opportunity president Evan Feinberg put these numbers into context, while dismissing absurd talk of “sequestration” as the cause:
???March was another lost month for my generation. Young people are finding fewer opportunities and are being saddled with the costs of our country’s unsustainable deficits.
???Some people will try to blame the laughably small cuts to government spending known as the sequester ??? but aside from the Post Office, government actually added 9,000 jobs last month.
“After years of deficit spending and government meddling in the economy, 1 in 6 of us don???t have a job. Half of us are doing no better than a part-time job. All the while, we are all stuck with a bill that keeps getting bigger. It???s like we???re the last one to leave the bar and everybody else ran out without paying their their tab.”
On the subject of sequestration: as Feinberg noted, it hasn’t really done much of anything yet. If the idea is supposed to be that fear of impending sequestration hardship is beating down the private sector job market – why would private employers who don’t count federal the government as a major customer care? – then who is more responsible for sequester-related job depression than Barack Obama and his allies? They’ve been screaming about the hardships of “austerity” in the most wildly fanciful manner, including many claims the White House was later obliged to quietly roll back. They deliberately tried to make Americans fear sequestration, as part of an orchestrated political strategy. They devised the “Firemen First” strategy to make things as painful as possible, resisting all counter-offers to cut useless Big Government bureaucratic flab instead. Every job that actually was “lost” due to sequester anxiety is Barack Obama’s personal handiwork.
And if fear of a tiny $43 billion slowdown in our ever-increasing federal spending supposedly blew thousands of people out of the workforce, then how can anyone dismiss fear of the vastly larger ObamaCare disaster as an even greater contributor to employer unease? Or how about the tax increases Obama slapped on job creators in his “fiscal cliff” deal, a financial drain with a far higher price tag that sequestration? How about all the new regulations he’s promising, all the new government controls he wants to impose, the huge shipment of unemployed people he wants to import via amnesty for illegal immigrants, the Democrats’ vows to raise the minimum wage? Why would any rational person believe none of that impacts the long-term hiring decisions of employers, but a modest trim to federal spending provokes white-knuckle job-destroying terror?
Update: In addition to Austan Goolsbee, another Obama-favored economist swallowing hard as he contemplates the March job report is Mark Zandi. On CNBC this morning, Zandi went completely off the reservation and admitted something you will find in no stack of Administration talking points: “I think healthcare reform might be having an impact.” He noted that hiring has slowed most dramatically during the first quarter for the companies most likely to be affected by ObamaCare regulations.