Better News On Jobs Doesn’t Mean All’s Well

NEW YORK, NY – MARCH 05: Protestors march across the Brooklyn Bridge to demand funding for excluded … [+]

There is a lot of Shakespearean “all’s well that ends well” commentary on the February job numbers, with an estimated 379,000 new jobs and a tenth of a percentage point drop in the unemployment rate.

Remarks I received from one chief investment officer noted a “very good headline number” and better news in the details. An “early blossoming” said Oxford Economics.

Seeing a bigger jump than expected is good. January’s numbers were revised up from 49,000 to 166,000. But December’s dismal loss of 227,000 became even bigger as the number of new jobs that month dropped to -306,000.

But the number of unemployed, at the rosiest official U-3 6.2% number, was still 10 million. Compared to February 2020, there are an additional 5.5 million out of the labor force. The more complete U-6 rate is 11.1%.

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And then there are the unemployment rates by categories for all workers 16+ in age (taken from the Bureau of Labor Statistics monthly report but edited to remove the Employment Status section but keep the column headings):

Unemployment rates by category of worker.

This gets even more complex when you consider the still occurring employment status misclassifications and people considered to have dropped out of the labor force (which can happen even if people look for jobs in listings but don’t see anything they can apply for). Here’s a tweet with a graph from the executive branch’s Council of Economic Advisors:

Those numbers get grim if you aren’t white.

You can see the biggest percentage hits to labor force participation (percentage of the population that is working) by category.:

Black and Hispanic women by far felt the hardest hit, with each down by more than 4 percentage points in one year.

White men and women were far less affected. Black and Hispanic men were even less so, although perhaps that is because of existing differences. In February 2020, white men 20 years of age or older had a 71.7%. For black men 20 and over, it was 67.3%. Hispanic males were at 80.8%.

The graph in the next tweet shows the pre-pandemic employment rate and the current one along with an extension at February’s pace:

Then there is looking at numbers that aren’t seasonally adjusted—an artificial change and smoothing by economists who try to take some of the jitters that make it harder to see trends. The current U-3 equivalent for non-seasonally adjusted unemployment for 16 years or older is 6.6%.

For disabled people, the figure is 12.6%.

In addition, there are the statistics for people holding multiple jobs. Right now, with non-seasonally adjusted figures, 4.5% of workers were holding multiple jobs, compared to 5.2% the previous February.

It’s also worth wondering how stable the job gains will be. Of February’s job growth, 355,000 was in leisure and hospitality, with 286,000 of those being in food-and-drink service. Multiple states have decided it’s safe to reopen, even though some, like Texas, have had a high impact and vaccination rates aren’t anywhere nearly high enough to offer close to normal conditions.

Too often, policy makers, elected officials, academics, economists, business leaders, and others point to high-level and general numbers. When discussing what a society needs, that isn’t good enough.

It’s the mindset that creates policies like a sudden cutoff in pandemic payments for anyone making more than $80,000, even though there is a lot of evidence that many above that income level were also hit hard during 2020 and when the data necessary to determine what people’s incomes were last year, when the damage first crashed down, isn’t available because taxes aren’t filed with the IRS.

It’s the foolishness that occurs when people think that talking about an average or a mean financial issue is adequate, as though everyone performed at exactly that level.

Time for greater attention to detail and nuance.

My credits include Fortune, the Wall Street Journal, the New York Times Magazine, Zenger News, NBC News, CBS Moneywatch, Technology Review, The Fiscal Times, and Inc. Get

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