The Bureau of Labor Statistics April jobs report – 160,000 jobs, unemployment stable at 5.0 percent – is cause for concern. Job growth lags the yearlong average of 232,000 per month, and is accompanied by downward revisions in the February and March totals. Both labor force participation and the employment-to-population ratio edged down as well.
There are still more than 15 million people in need of full-time work. And millions more forced into part-time, temporary, contract, and no-benefit service jobs that have been where most of the jobs growth has been. In this report, employment in mining continues to decline (sensibly enough), while manufacturing and construction showed little growth.
Average hourly wage growth was up to 2.5 percent, but most workers still aren’t seeing much reward from the recovery. The record 74 months of private sector jobs growth has only begun to make labor scarce enough to give workers bargaining power to lift wages.
The Federal Reserve reports that the economy grew 0.5 percent in the first quarter. (Since that is the annualized rate of growth, it means the economy actually grew little more than 0.1 percent in the first quarter). That “stall speed” follows a rapid decline over the preceding three quarters.
The Federal Reserve put off any consideration of lifting interest rates until June. This report will add to concerns that the economy is faltering. Interest rates near zero are not generating the lift needed. Similarly in Europe, aggressive monetary policy has fended off recession but not produced growth. Japan is in recession. China’s troubles continue.
So even the International Monetary Fund – the bastion of conservative economics – is pleading with governments in the United States and Germany to start spending money on real needs.
Congressional inaction is truly perverse. Millions are in need of full-time work. Thirty-year-olds are making no more now in real terms than they did 30 years ago. Our infrastructure – from water systems to bridges to trains and energy grids – is decrepit and increasingly dangerous to our health. The U.S. government can borrow money for virtually nothing, invest it in rebuilding the country, put people to work, and the growth and added employment will generate the revenue to more than repay the loans. Yet Congress continues to be AWOL. Republicans are content to bray publicly about deficits, and presumably pray privately that the economy slows enough to put the buffoon that they’re about to nominate into the White House.
Presidential candidate Bernie Sanders is surely right: We need a political revolution just to bring common sense back to Washington.