Follow us:

Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

January 10, 2014 at 10:17 AM

Vote: The economy in 2014

It’s a tough day to ask for your prediction for the new year. December saw only 74,000 jobs added to U.S. payrolls, far below what is needed merely to keep up with the natural growth of the labor force (around 125,000). Worse, it brought the average monthly growth for the year to 182,000 vs. 183,000 in 2012.

In other words, the anticipated recovery in jobs isn’t happening. At the rate of the past three months — 172,000 — it would take almost six years for the labor market to recover to its pre-recession levels. Also, half of the December gain came in temp jobs.

Much of the media will focus on the unemployment rate dropping to 6.7 percent from 7 percent. This is actually not good news because it is not happening because of job growth. Labor-force participation is at its lowest level in 35 years and the share of the working-age population with a job didn’t increase. According to the Economic Policy Institute, if these people had been included the unemployment rate would be 10.2 percent.

As for this year, the famously bearish Dr. Doom, Nouriel Roubini, argues that growth will pick up, at least modestly. Nobel laureate Joseph Stiglitz takes the opposite view: “The great malaise drags on.” I say, as long as federal austerity continues, we can’t hope to dig out of the demand hole left by the Great Recession.

What say you?

This Week’s Links:

Failure to extend emergency unemployment benefits will hurt workers in every state | CBPP

Boeing goes to pieces | The American Conservative

Why presidents stopped talking about poverty | The New Yorker

The loopholes in the Volcker rule | Forbes

Five economic reforms millennials should be fighting for | Rolling Stone

My lesson from the crisis | Lawrence Summers

Secular stagnation, green shoots or what? | Naked Capitalism

Today’s Econ Haiku:

It’s the new normal

Slow jobs growth, falling incomes

Mission accomplished

Comments | More in Jobs/Unemployment | Topics: 2014 predictions

COMMENTS

No personal attacks or insults, no hate speech, no profanity. Please keep the conversation civil and help us moderate this thread by reporting any abuse. See our Commenting FAQ.



The opinions expressed in reader comments are those of the author only, and do not reflect the opinions of The Seattle Times.


Advertising
The Seattle Times

The door is closed, but it's not locked.

Take a minute to subscribe and continue to enjoy The Seattle Times for as little as 99 cents a week.

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Subscriber login ►
The Seattle Times

To keep reading, you need a subscription upgrade.

We hope you have enjoyed your complimentary access. For unlimited seattletimes.com access, please upgrade your digital subscription.

Call customer service at 1.800.542.0820 for assistance with your upgrade or questions about your subscriber status.

The Seattle Times

To keep reading, you need a subscription.

We hope you have enjoyed your complimentary access. Subscribe now for unlimited access!

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Activate Subscriber Account ►