Jobs recovery remains sluggish, but incremental progress

Posted by AzBlueMeanie:

While ostensibly American companies (multi-nationals) continue to sit on more than $2 trillion in profits and invest in expanding overseas markets rather than here in America, the jobs picture in the wake of the Bush Great Recession remains sluggish. The old days of the "V" shaped recovery from a recession are long gone, replaced by an elongated "U" shaped recovery. High unemployment becomes the "new normal" in such a recovery, and that is not a good thing.

Steve Benen at The Washington Monthly is out with his monthly jobs report graphs today for the month of December:

The good news is, conditions improved in the final month of 2010. The bad news is, the new jobs report points to growth that isn't good enough, and fell a little short of expectations.

The United States economy ended the year by adding 103,000 jobs in December, the Labor Department said Friday, a number that missed expectations. In addition, the unemployment rate fell to 9.4 percent last month from 9.8 percent. […]

While the overall picture showed improving job growth, the additions in the private sector in December were not enough to significantly reduce the ranks of the unemployed or keep pace with people entering the work force. The outlook remains bleak for many workers. More than 14.5 million people were out of work in December.

Still, economists noted that the jobs data is a lagging indicator and pointed to other signs of a turnaround, though their outlook for 2011 remained varied.

"The U.S. economy finally appears to be picking up steam and headed toward recovery," said Steven Blitz, a senior economist for ITG Investment Research. "Several economic indicators — including manufacturing and services output, and sales of cars and consumer goods — have shown noticeable improvement over the last few months." 

As has been the case for over a year, all of the job growth is occurring in the private sector. In December, the private workforce grew by 113,000 jobs, while the public sector shed 10,000 jobs. It was the 12th consecutive month of private-sector job growth.

On a slightly more encouraging note, the totals from October and November were both revised upwards, with October's totals reaching 210,000 jobs, one of the best months of the year, and November's awful totals being revised to 71,000, up from 39,000.

It's important to emphasize, though, that while December was better than November, the economy adding 103,000 jobs last month isn't good enough. Indeed, it's not even close. To help get us back to where we need to be, we would look for totals more than twice as strong as these.

Still, incremental progress is incremental progress, and most forecasts appear to have relatively high hopes for 2011.

Steve Benen continues at The Washington Monthly:

[H]ere's a slightly different chart — one showing just the private sector job market.

For much of 2010, this was important because of the sharp differences we've seen between the private and public sectors. Most notably, the rise and fall of Census Bureau jobs can offer a skewed picture — some months, such as May 2010, look better than they should, because the monthly total is exaggerated by hundreds of thousands of Census jobs. Other months, such as June 2010, are distorted in the other direction, looking worse than they should.

But that period is just about over. In December, while the public sector lost 10,000 jobs, the private sector added 113,000 jobs, the 12th consecutive month of private-sector growth, which is nice, but not as nice as more robust job creation. The totals for both October and November, however, were revised upwards and appeared more at least slightly more encouraging.

All told, the economy added more than 1.3 million private-sector jobs in 2010. For comparison purposes, note that the economy lost nearly 4.7 million private-sector jobs in 2009, and lost 3.8 million in 2008.

With that in mind, here is a different homemade chart, showing monthly job losses/gains in the private sector since the start of the Great Recession.