Why the New Jobs Report is a Fiscal and Economic Disaster
A lot of noise followed the October 5 release of the BLS's last jobs report before the election. Many on the Right were quick to claim that the numbers don't make sense and suggest they were "cooked" to artificially smooth the President's path to re-election. The Left was quick to jump on the Right, claiming they don't want the economy and jobs picture to improve. Both are wrong.
The release of the BLS's final (and best jobs report of Obama's presidency) October 5, was followed by widespread disbelief among many across the political spectrum while the Obama re-election team trumpeted the results as a positive indication of economic recovery.
While the numbers may be accurate, there is every reason to be very concerned and no real reason to cheer these numbers.
According to the September BLS report, "Total employment rose by 873,000 in September, following 3 months of little change."
Yet the BLS survey of employers shows only 114,000 jobs were added to the economy.
Every month, we try to break down the monthly employment report from the BLS and analyze it in plain English. Todayís report of September employment is so bizarre that itís hard to comprehend, much less give over.
The BLS puts out two surveys:† 1) the establishment survey, which shows the growth in non-farm payroll jobs (as well as a breakdown by specific industry), surveys businesses and 2) the household survey, which measures broad census data, such as total number of employment-age population, size of the labor force, the U3 unemployment rate, and total number of employed and unemployed, surveys individual households. Itís always hard to get a precise picture of the employment situation because you need to conflate data from both surveys; however, the surveys usually complement one another in a coherent fashion.
That is not the case with todayís report.
The BLS report suggests an answer to where the jobs arose:
"The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) rose from 8.0 million in August to 8.6 million in September. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.
In short, about 600,000 new part time jobs suddenly emerged from the individual household surveys.
There are real reasons to question the sudden historically unprecedented job emergence these household survey numbers claim. But the real story is that if we accept the data without question, these "new jobs" are still not jobs that represent real growth in the economy and they will not improve the economic vitality of our nation, nor will they increase revenue to the federal treasury.
Let me emphasize. While the September jobs numbers are up substantially, the increase is dominated by jobs that represent a curtailment of the economy, not a growth in the economy. When full time jobs are pared back to part time and then become established as permanent, they do not represent either job or economic growth.
The most recent quarterly economic growth figures were revised downwardon September 27 to an anemic 1.3%. This is the real indication of the state of our economy, and it is dismal.
Unless we are ready to accept anemic economic growth and anemic full time job creation (114,000 in the latest report) as the "new normal" then there is nothing whatsoever in the September BLS report about which we should cheer.
Contrast the Obama job "growth" with that which Mitt Romney is committed to achieving.
Obama's job "growth" comes in the part time (and necessarily low income) category that yields no additional federal treasury revenue since it is simply making permanent the changed status of a once full time job. This is distinguished from the usual temporary part time jobs that are seasonally cyclic.
These new figures do not give any comfort to the Obama approach, a complete failure for four years. The latest BLS figures show Obamanomics is creating a permanent job malaise by converting once full time jobs into permanent part time jobs that simply make the deficit and debt situation worse while slamming the door on employment opportunities for young college graduates. Unemployment among those 25 and under is double that of the population in general. Obamanomics offers no future hope for the American worker and particularly to those 25 and under.
Romney's economic plan seeks real full time job growth over all income categories by removing barriers to new and expanded enterprise and job creation in the private sector. This is the only healthy and robust approach to both improving our economy and jobs while bringing real additional revenue into the federal treasury.
The Romney plan seeks to create real job growth through revenue-neutral tax reforms involving lower rates to stimulate the economy while lowering energy costs in a massive drive toward real energy independence through job-creating robust exploitation of all our domestic energy resources. This approach rejects the "new normal" of Obamalaise and re-establishes the "American Dream" of improving living standards for future generations without burdening them with unconscionable debt.
If you like the idea of fewer full time jobs and continued lower federal revenues from the job market, then you'll cheer the latest BLS unemployment figures.
But if you're concerned about real job growth, restoring economic vitality, energy independence, and increasing federal tax revenues to reduce deficits and debt, then the new BLS figures should make you very concerned about our nation's future.
There is every reason to be very concerned and no real reason to cheer these new BLS numbers.
Bob Webster, a 12th-generation descendent of both the Darte family (Connecticut, 1630s) and the Webster family (Massachusetts, 1630s) is a descendant of Daniel Webster's father, Revolutionary War patriot Ebenezer Webster, who served with General Washington. Bob has always had a strong interest in early American history, our Constitution, U.S. politics, and law. Politically he is a constitutional republican with objectivist and libertarian roots. He has faith in the ultimate triumph of truth and reason over deception and emotion. He is a strong believer in our Constitution as written and views the abandonment of constitutional restraint by the regressive Progressive movement as a great danger to our Republic. His favorite novel is Atlas Shrugged by Ayn Rand and believes it should be required reading for all high school students so they can appreciate the cost of tolerating the growth of unconstitutional crushingly powerful central government. He strongly believes, as our Constitution enshrines, that the interests of the individual should be held superior to the interests of the state.
A lifelong interest in meteorology and climatology spurred his strong interest in science. Bob earned his degree in Mathematics at Virginia Tech, graduating in 1964.