Friday, July 02, 2004
Now You See It....
The job report for the month of June was released today and the numbers were much lower than projected.
Overestimating is not necessarily a bad thing. I've done it myself on occasion. For instance, I've often overestimated my tolerance for alcohol. These things happen. And yes, we did gain jobs. That is a good thing even if it is not as many jobs as we would like. Anything to recover the 3,000,000 we lost is good. But many analysts see this as troublesome for the economy. If jobs continue to grow at this slower rate, Bush has no chance of recovering the jobs that were lost before November. This is one of the key issues in this year's election.
Now overall, I don't find the slower than expected job growth issue as troubling. What does bother me, is what else is contained in this report.
In other words, the jobs that were added were less than full-time, which means they aren't likely to include benefits (ie-health insurance). Now I realize, a job is job. Any job pays more than no job at all. But when the government states that they have added jobs, what they are neglecting to report is the quality of the job. A person who lost their job as a salaried employee two years ago and then takes a job working the fryers when McDonald's expands for summer help is still considered a job added. Not quite the same thing though.
Even more troubling, is the fact that they have revised the job numbers for April and May. And not in a positive direction, I might add.
This is something our government is good at. Stating one thing and then later revising the numbers or backpedalling from their promises. Remember the $15 billion promised to fight AIDS in Africa in last year's State of the Union Address? Guess how much money was budgeted by the White House. If you guessed $0 you are correct. How about the money promised to fund No Child Left Behind? (As an educator, this is a big issue with me and will be the subject of a future posting, I'm sure.) Did you know that it was underfunded by $10 billion dollars? Probably not, because this administration makes a big deal about announcements, but then quietly goes about the actual business. The big announcement makes the news, but the quiet deception doesn't get covered. It's like the fine print in those television commercials -stunt driver, closed course, do not attempt, weight loss not typical, etc. -, you really have to look close to see it.
So when Peter Jennings says the economy added 112,000 jobs last month, keep in mind that there's more to those numbers. You see, numbers are wonderful things. They never lie, as long as you're given all of them.
- Job growth slowed dramatically in June, as employers added just 112,000 workers to payrolls last month, a number that came in well below forecasts by private economists.
The gain was about half of May's revised gain of 235,000 jobs, and was the weakest since February following three straight months of strong job growth, the Labor Department reported.
Economists surveyed by Briefing.com had forecast a gain of 250,000 jobs, on average.
Overestimating is not necessarily a bad thing. I've done it myself on occasion. For instance, I've often overestimated my tolerance for alcohol. These things happen. And yes, we did gain jobs. That is a good thing even if it is not as many jobs as we would like. Anything to recover the 3,000,000 we lost is good. But many analysts see this as troublesome for the economy. If jobs continue to grow at this slower rate, Bush has no chance of recovering the jobs that were lost before November. This is one of the key issues in this year's election.
Now overall, I don't find the slower than expected job growth issue as troubling. What does bother me, is what else is contained in this report.
- Aside from the sharp slowdown in job growth, the report contained more bad news for workers.
Average hourly wages rose 2 cents, or 0.1 percent, to a seasonally-adjusted $15.65. But that was well below the 0.3 percent gain that economists had forecast.
In addition, the average work week fell to 33.6 hours for private sector employers last month from 33.8 in May.
"This economic recovery is a lot more fragile than most of us thought," said Anthony Chan, chief economist for Banc One Investment Advisors.
In other words, the jobs that were added were less than full-time, which means they aren't likely to include benefits (ie-health insurance). Now I realize, a job is job. Any job pays more than no job at all. But when the government states that they have added jobs, what they are neglecting to report is the quality of the job. A person who lost their job as a salaried employee two years ago and then takes a job working the fryers when McDonald's expands for summer help is still considered a job added. Not quite the same thing though.
Even more troubling, is the fact that they have revised the job numbers for April and May. And not in a positive direction, I might add.
- The Labor Department revised its job estimates for the last two months, saying payrolls grew by 324,000 instead of 346,000 for April, and 235,000 instead of 248,000 in May.
This is something our government is good at. Stating one thing and then later revising the numbers or backpedalling from their promises. Remember the $15 billion promised to fight AIDS in Africa in last year's State of the Union Address? Guess how much money was budgeted by the White House. If you guessed $0 you are correct. How about the money promised to fund No Child Left Behind? (As an educator, this is a big issue with me and will be the subject of a future posting, I'm sure.) Did you know that it was underfunded by $10 billion dollars? Probably not, because this administration makes a big deal about announcements, but then quietly goes about the actual business. The big announcement makes the news, but the quiet deception doesn't get covered. It's like the fine print in those television commercials -stunt driver, closed course, do not attempt, weight loss not typical, etc. -, you really have to look close to see it.
So when Peter Jennings says the economy added 112,000 jobs last month, keep in mind that there's more to those numbers. You see, numbers are wonderful things. They never lie, as long as you're given all of them.
