Today’s jobs report is another bad one: 80,000 in June. This is well below the 125,000 minimum needed to keep up with just the natural growth of the labor force. While the unemployment rate remained at 8.2 percent — bad enough — the wider (more meaningful) U-6 number ticked up to 14.9 percent.
What’s going on? We’re still stuck in the Great Recession hangover, with a variety of factors holding back recovery. To be sure, output and corporate profits have recovered completely (although not necessarily for your neighborhood small business). But the jobs crisis remains.
My take is that the biggest problems are the huge hole in demand left by the recession and ongoing weakness worldwide; some companies realizing they can get by with fewer people; continued deleveraging; continued offshoring, and the imbalance of the economy in recent years, where far too many jobs were connected to the bubble. As a result of the latter, there are in many cases a skills mismatch. We’re going to need far fewer construction workers, barring a major stimulus, and far fewer people working in, say, mortgage boiler rooms. Also, previous recessions typically saw a rise in government hiring (e.g. 1982), while this time government jobs have fallen overall.
What do you think? The software gods are not cooperating on generating a poll today, so leave your answers in the comments.
Read on for the best links of the week and the haiku:
This Week’s Links:
- The dismal working conditions at Wal-Mart’s subcontractors || Salon
- The Libor scandal hits home (literally) || NPR
- Where are the most uninsured: California and the South || Slate
- South Carolina to market itself as aerospace hub in London || Wash Post
- A carbon tax: Sensible for all || NY Times
- Say’s Law and the Keynesian multiplier || Uneasy Money
- Numbers tell of failure in the war on drugs || NY Times
- Remittances to Mexico rise to highest level since October 2008 || LA Times
- The post-Cold War era is over || Salon
- The first money market casualty of the ECB: JPMorgan || Zero Hedge
- GlaxoSmithKline’s bribes are evidence Big Pharma isn’t working || The Guardian
- Why lower oil prices are not a good sign || The Oil Drum
Today’s Econ Haiku:
Summer’s finally here
Seattle house prices rise
Warm if not quite hot