The job numbers were pretty good. They were a lot better than I expected. Even with the jump in temporary hiring, the underlying numbers continued to show improvement. I do not, however, think it’s time to break open the champagne, not time to do the happy dance. The economy still has a lot of problems. There are still millions of Americans who have stopped looking for jobs. There are millions of Americans who are underemployed.
Here’s what I know – when Barack Obama took office our economy was losing over 500,000 jobs per month. The economy had fallen off a cliff. We needed someone like Superman to rescue the economy before it crashed into the rocks below. Now we are adding jobs every month. This is good. I wonder whether we can figure out a way to get Republicans to stop hindering job growth.
This morning’s release of the December 2011 employment situation report, which marked four years since the official start of the recession in December 2007, capped off 2011 on a positive note. Both the establishment survey and the household survey showed improvement – the labor market added 200,000 jobs, hours and wages were up, unemployment ticked down, underemployment dropped, and the duration of unemployment spells declined. This is a step in the right direction.
The length of the average workweek increased in December to 34.4 hours, restoring hours to where they were last spring. Average hours have thus far made up just three-fourths of what they lost in the first 18 months of the downturn (average hours were 34.6 in December 2007 and 33.7 at the low point in June 2009).
Average hourly wages increased by 4 cents in December and have risen at a 1.9% annualized rate over the last three months. This remains far below the pre-recession growth rate (3.4 percent from December 2006 to December 2007), as persistent high unemployment has exerted strong downward pressure on wage growth. With hours and hourly wages up, average weekly wages grew more strongly at $3.70, and they have risen at a 3.1% annualized rate over the last three months.
Unemployment in December was 8.7 percent for those age 25 or older with only a high school education, and 4.1 percent for those age 25 or older with a college degree or more. While workers with higher levels of education have lower unemployment rates, all education categories have seen their unemployment rates roughly double over the downturn, a trend running counter to the notion that there is high unemployment because employers are unable to fill their demand for workers with higher education credentials.
Considering additional breakdowns by age, race/ethnicity, and gender, we find that all major groups of workers have experienced substantial increases in unemployment over the Great Recession and its aftermath. However, young workers and racial and ethnic minorities have been and continue to be hit particularly hard.