Unemployment is down to 6.7 percent. Obama’s policies have finally broken the 7 percent barrier.
No doubt that number will lead many news reports today now that the Bureau of Labor Statistics has released the jobs figures for December.
And don’t be surprised when the White House and Democratic leaders trumpet this as a great success and vindication for the error of their Keynesian ways. As this is written, the gears are rattling and the smoke is pouring out of the Talking Points Memo website while the Left tries to figure out how to spin this jobs report.
Because despite the apparent improvement of the unemployment figure, this report is a disaster that only underlines the fraud and failure of Obama’s economic policies.
The real story here is that the economy only churned out 74,ooo new jobs in December.
Take a minute to realize what that means. Analysts had predicted that the report would show somewhere around 200,000 new jobs for the month, so this is only about a third of what was hoped for.
But even 200,000 wouldn’t have been a good number for recovery because the population of the country regularly grows by about 180,000 mouths to feed every month — in December, it was 178,000. We need something around 120,000 to 150,000 jobs every month just to keep up with population growth. Effectively, 74,000 new jobs reflects a net negative job growth of probably 25,000 to 75,000 positions when compared with population increase.
What makes this even worse is that these are the figures for December, a month where historically retailers hire for a lot of temporary positions because of the holidays. Some of that hiring was shifted into November because of an early Hanukkah, but even so, there should have been a bigger bang just with Christmas jobs.
So how can the unemployment figure have gone down?
First, you have to realize that not all unemployment figures are equal. The government has a range of reports that it classifies from U-1 to U-6, with the lower range being more manipulated than the upper range. The number that’s normally reported as “the” unemployment figure is from the U-3 report and excludes a lot of people, particularly those who are “underemployed,” working part time because no full-time jobs are available, or who have simply given up hope of finding a job.
The U-6 number is often considered a more accurate measure of overall unemployment, and it stayed the same in December at 13.1 percent. Some economists have suggested that even that number is low.
The magic ingredient in the Obama jobs stew is the number of people who drop out of the labor force entirely each month. These are people who either give up looking or who have simply been unemployed so long that the Administration just doesn’t count them anymore. For December, the BLS reports the civilian labor force shrank by 347,000.
So that decrease in the unemployment number isn’t because we’re going back to work; it’s because the government simply counts fewer people as potential workers.
And that’s typical for this Administration and this Congress. The actual results of government programs don’t matter; the actual effect on people doesn’t count. All they want is a sound bite for the media’s talking heads.