Good news! Today's jobs report shows we're not spiraling head-first into a double-dip recession. On the downside: the economy's not really growing much either. Jammed into the October Labor Department report showing an improved 9 percent unemployment rate and the addition of 80,000 jobs are reams of surveys and labor statistics about the condition of the U.S. economy. Here's the good but mostly troubling news that analysts and economists are teasing out.
Look at the bright side The Economist's Free Exchange blog is more optimistic than most but they're no Pollyannas. "Things could be far worse and they're getting better," reads the blog. "They remain a long way from good, however." They pull out some encouraging numbers for the household survey: "employment rose by 277,000 in October, outstripping growth in the labour force and bringing the unemployment rate down a notch to 9.0 percent. Broader measures of underemployment also dropped, along with the number of long-term unemployed. The employment-population ratio ticked up slightly, as did hours worked and average earnings."
Saying there was a drop in unemployment is a little misleading Every month 100,000 new people enter the labor force, so if the economy only added 80,000 jobs, how did unemployment go down? The Wall Street Journal's Phil Izzo says it's because the unemployment rate and the job creation numbers come from different surveys. The former comes from a survey of U.S. households while the latter comes from a survey of establishment payrolls. "The household survey is much smaller than the establishment survey, and as a result it can swing around a lot — and move the unemployment rate up and down when it does," writes Izzo. "That volatility is a big reason why economists usually, but not always, pay much more attention to the establishment report."
At least we're avoiding a double-dip recession Felix Salmon at Reuters is downright cheery. "The broad U-6 unemployment rate fell by 0.3 percentage points, to 16.2%," he writes. "I, for one, am much more sanguine about the prospects for a double-dip recession than I was a couple of months ago. If the jobs situation isn’t getting worse, that means America’s still growing, and that the recession’s still over."
We should still be in crisis mode The Washington Post's Brad Plumer is not impressed. "There’s good reason, as ever, to see mass unemployment as a full-blown national crisis," he writes. "Indeed, this marks the seventh straight month that the jobless rate hasn’t nudged below 9 percent (it was at 9.1 percent last month) ... That still leaves vast battalions of unemployed workers sitting out there." Peter Boockvvar at The Big Picture is similarly dejected. "Bottom line, an 80k payroll gain compares with 126k avg in the 10 months ytd and the private sector gain of 104k is also below the 10 month avg ytd of 153k. Thus, we’re seeing jobs gains still but at a mediocre and uneven pace."
You still can't call this a recovery Heather Boushey at the Center for American Progress gives a sense of where the economy should be. "At this point in the recovery we should be seeing upwards of 300,000 jobs created per month, but the economy only added a paltry 80,000 jobs in October and the three-month pace of job creation is only 114,000."