The Bureau of Labor Statistics has released the job numbers for November 2015, and much of the media is repeating the Fed’s rote line that this is yet another “key indicator of economic strength,” and that maybe, just maybe, it is time to raise interest rates. Whether or not Federal Reserve Chair Janet Yellen decides to raise interest rates is an important topic to consider, but that discussion almost always neglects the plight of tens of millions of Americans.
The headlines tell us that 211,000 “new jobs were created” in November. That figure comes from a monthly government survey of employers, which has a built-in “birth-death model” that estimates monthly job growth and may add tens of thousands of nonexistent jobs to the survey. Or, it may provide a fairly accurate estimation of job creation. Economists argue over how well the monthly BLS job numbers reflect the strength of the U.S. economy. There is no argument that many of the reported new jobs are in seasonal and lower-paying occupations, such as construction and retail.
While the report on job numbers, and the current debate about rate hikes is important to Wall Street, what matters most to Americans is employment. Job creation is meaningless unless it is measured against the increase in the working-age population and coupled with the results of the household survey, which measures the employment status of individuals. While the economy may be strong enough in the view of the Fed to raise interest rates above present historic lows, overall the economy can be described, at best, as stagnant – which wouldn’t be so bad for so many Americans if actual unemployment weren’t astronomically high.
We learn from the household survey that 15.7 million Americans are looking for full-time work; up 150,000 from last month. The number of people not in the labor force in November remained statistically unchanged at 94.4 million – that’s 38 percent of the total working-age population. Of that 94.4 million, 56.2 million are between the ages of 16-64. The labor participation rate (the percentage of working-age employed) also remained virtually unchanged, stuck at a 38-year low. And wage gains for November were 2 percent, a rise economists consider paltry; and this despite the incessant claim by employers that there is a chronic shortage of skilled workers in the U.S.
The worst news from the BLS is that part-time jobs accounted for 125 percent of employment gains reported in the November household survey. There was a 244,000 increase in the number of people employed, which may seem like a banner month of employment gains. However, there was a net 307,000 increase in the number of people who reported that they were working part-time. Additionally, 319,000 more people reported that they were working part-time for economic reasons (not by choice) in November than in October. Looking at those numbers, we can say that there were at least 75,000 more people who were unsuccessfully looking for full-time work in November than in October. This is one of the reasons the U-6, a more accurate measure of unemployment and underemployment, went up to 9.9 percent. Considering that a good portion of those part-time jobs will only last a few weeks during the Christmas season, there is not much room for optimism for millions of American workers moving forward into 2016.
At NumbersUSA, we spend a lot of time connecting immigration policy to economic policy. Of course, immigration policy is not the only headwind facing American workers, but few outside the political elite think it's a good idea to bring in one million new foreign workers every year, especially when job gains for the foreign-born continue to outpace those for the U.S.-born. The U.S. economy will never truly be strong unless and until U.S. immigration policy is in-line with the interest of American workers. The enthrallment over the latest job numbers demonstrates that the political elite of this country don't understand that - or they don't really care.
Updated: Mon, Jul 24th 2017 @ 2:38pm EDT