Demanding bold solutions to today’s jobs crisis.
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This morning’s jobs report from the Bureau of Labor Statistics is somewhat encouraging news for job seekers, but it does not change what we’ve been saying about the economy for the past year: To the extent to which we can call what we’re experiencing a “recovery,” it is fragile and endangered. It is still the wrong time to impose austerity measures that will choke off the lifeline to real economic recovery for millions of Americans.
The economy produced a total of 222,000 private sector jobs, but that was offset by a decline in 30,000 in public sector jobs. The net result is that we’re still not making any real headway in replacing the 8 million jobs lost in the so-called Great Recession. Dean Baker of the Center for Economic and Policy Research writes in his memo today that “”At the rate of job growth over the last three months, it would take almost 14 years to get back to normal rates of unemployment.”
We clearly cannot wait 14 years.
As our co-director Robert Borosage put it this way in a news release today, “don’t break out the bubbly”:
The reality is still sobering. The unemployment rate and the number of unemployed remain unchanged. 24.7 million workers are unemployed or underemployed.
We aren’t sinking, but we’re still treading water. Over the past year, we’ve gained 1.3 million jobs, or an average of 106,000 a month. As Fed Chair Ben Bernanke testified, this is not sufficient to employ the new people coming into the labor market, much less begin to recover the 8.5 million jobs lost in the Great Recession.
Moreover, the headwinds that the economy faces are still fierce. State and local government employment declined in February, with more layoffs certain to come at all levels of government. If the budget cuts passed by the House are enacted into law, the loss of jobs at the federal level alone, projected at 700,000 by [Mark Zandi of Moody’s Analytics] would erase more than three months gains at the February’s rate. And, of course, the February figures do not reflect the effects of the rising price of oil and gas coming out of the turmoil in the Middle East. Turning to austerity now will sap the fragile momentum the economy has.
Mass unemployment, with record levels of long-term unemployment, is a human and social calamity. In February, we stopped losing ground. But the economy is still a long way from a recovery that working families can experience.
That message is being echoed by economist Heidi Shierholz at the Economic Policy Institute, who notes that “some of February’s growth is simply a positive rebound effect after bad weather last month, and the trend is modest. This limited growth underscores the fact that proposed cuts in federal spending would actually kill jobs and overwhelm recent labor market improvements.”
Congressional conservatives, led by House Majority Leader Eric Cantor, are using today’s jobs report to justify their destructive machete-slashing of programs that offer ladders out of the economic hole that tens of millions of people fell into as a result of their failed economic policies. “To put it simply: less government spending equals more private sector jobs,” Cantor says in a press release today. He is wrong, of course. The case is as strong as ever that more government spending in key areas is essential to build a new economy where large numbers of people can earn decent wages, either in the private sector or in public service.
One stunning report today from The Hamilton Project at the Brookings Institution demonstrates the need for bold new policies to rebuild the economy for broad prosperity.
That report concludes that the phrase “stagnating middle-class wages” understates what has happened to working people in the past four decades. “Earnings have not stagnated but have declined sharply,” write Michael Greenstone and Adam Looney. “The median wage of the American male has declined by almost $13,000 after accounting for inflation in the four decades since 1969. This is a reduction of 28 percent!”
They also conclude that it will take well over a decade to repair the damage done to the labor market by the recession if the nation settles for the status quo of the past few years.
That is why we need to take audacious ideas for job creation into the political debate now. We cannot afford the conservative approach of cutting off the very programs that provide needed fuel for recovery. And we cannot — must not — be satisfied with what the inside-the-Beltway wisdom says is politically possible.
What should not be politically possible is tolerance of a “lost decade” of high unemployment and lost hope.