On the surface Friday’s jobs report from the Bureau of Labor Statistics (BLS) wasn't so bad: 169,000 jobs were created in August and the unemployment rate dropped slightly, once again, to 7.3 percent. This was slightly below expectations (180,000) but about in line with the average monthly gains over the past year.
But — and it’s a big but — not everyone is participating, and some of those numbers aren’t real. Temp jobs jumped to new highs, rising in excess of four times more quickly than jobs in the general economy. Employment in auto manufacturing rose nicely, continuing to outpace the economy in general. The oil and gas business is booming, and employment there continues to accelerate. Construction was flat for the month but has grown at twice the national rate over the last 12 months, creating nearly 650 new jobs every day.
Those with college degrees are faring better, too. While college graduates represent less than 40 percent of those aged 25 and over, they captured nearly three out of four new jobs gained in that group. So, here’s the good news: Temp help, oil and gas, auto manufacturing, and construction are all adding jobs much more quickly than the economy in general. And college grads are enjoying most of them.
The bad news is that the rest of the economy is stagnant with little likelihood of improvement anywhere on the horizon. According to Michael Strain, resident scholar at the American Enterprise Institute, at the rate the economy is creating jobs over the last three months (BLS numbers for June and July were revised significantly lower than originally reported), the jobs “gap” created by the Great Recession won’t be closed until the year 2025 — 12 years from now.
The unemployment rate is distorted as well, since it measures only those “actively” in the work force, which number has been declining. As Strain expressed it: “A labor force that shrinks in size along with a drop in the number of employed workers is nothing to celebrate.”
Click here to read the entire article.