This morning the Bureau of Labor Statistics (BLS) released the shutdown-delayed September employment report. It certainly wasn’t worth the wait. BLS reported that the economy added 148,000 nonfarm payroll jobs and 126,000 private sector payroll jobs during September and that the unemployment rate dipped to 7.2%.
Today’s report did nothing to close this recovery’s job creation gap with prior recoveries. Since private sector payroll employment hit bottom in February 2010, the economy has added 7.6 million private sector jobs over the 43 months, a gain of 7.1%. In other recoveries since 1960, private sector payroll employment grew an average of 11.4%. That leaves this recovery with a private sector jobs gap of 4.6 million compared to the average of other post-1960 recoveries. The deficit compared to the Reagan recovery is even more pronounced with the private sector job creation gap standing at 7.0 million.
The 0.1 percentage point drop in the unemployment rate was the result of rounding up in the August report and rounding down in the current report. Despite recent declines in the unemployment rate to 7.2% from its October 2009 peak of 10.0%, the percentage of the adult population that is employed has actually decreased since the end of the recession. Factoring out declines in labor force participation since January 2009 would yield an unemployment rate of 10.8% far above the reported 7.2% and promised “stimulus rate” of 5.0%.
Since the recession ended, the percentage of adult Americans who are employed has declined by 0.8 percentage point. This compares with an increase of 3.8 percentage points during the strong recovery of the 1980s.
While this the period covered by this report was prior to the partial government shutdown, it is certain that the White House will once again try to shift blame away from the Administration for the economy’s poor performance. One can expect the White House to engage in a public relations effort to lay the ground work to blame the partial federal government shutdown for disappointing economic news in the weeks to come. The JEC Republican staff will be prepared to address any false or misleading claims the White House makes in this regard.