If I were Obama, I’d be ashamed to publish a report like the employment report published by BLS (Bureau of Labor Statistics) this morning. The reported gain in private sector employment of over 80,000 jobs and the decline in the unemployment rate to 9.5% completely distorts the real employment picture.
The following spreadsheet provides the BLS data, along with a more realistic picture of unemployment.
As you can see, the decline in the unemployment rate to 9.5% was made possible only by the government’s assumption that 652,000 workers exited the labor force in June, apparently no longer needing a source of income to put bread on the table. This was the second month in a row that the labor force has declined, and was exceeded only slightly by the decline in December, ’09. If the government was honest in their estimation of the labor force, they’d steadily be adding over 120,000 workers every month, thanks to population growth.
Contrary to this morning’s report, here are the grim facts:
- In June, the employment level fell by 301,000 workers, the third monthly decline in a row. (See column E.)
- Assuming the labor force to be a constant percentage of the population, unemployment rose in June to 11.5% from 11.2% in May. (See column H.)
- The number of unemployed Americans rose to over 18 million in June, the 2nd increase in a row.
- U6a (see column J), the broader measure of unemployment, spiked above 20% again, rising to 20.4% from 19.9% in May.
As the day wears on, expect analysts to see through the smoke and mirrors and come to the same conclusion: this is just one more piece of data that supports the view that the economy is sliding back into recession.
Not surprising. The president has done absolutely nothing to address the fundamental problems with the economy – the huge trade deficit in manufactured goods caused by trade policy that fails to take into account the role of population density disparities (in other words, his failure to act decisively with tariffs to restore a balance of trade), and his continuation of policies that pile more immigrant workers onto an already-glutted labor force.
In fact, he’s making matters worse. At the conclusion of the G20 last week, he delivered a left jab to American workers by announcing his intention to push through a free trade deal with South Korea, the third most densely populated nation on earth (behind Bangladesh and the Palestinian Territory), 15 times more densely populated than the U.S. and heavily dependent on manufacturing surpluses to sustain their bloated labor force. And yesterday he delivered a right cross to the jaw of American workers by pushing for amnesty for illegal aliens. American workers are reeling, about to fall to the mat for the count.
Obama is no friend to American workers and, despite his efforts to gloss over the employment situation, his policy chickens are coming home to roost. Each new piece of economic data reinforces the picture of an economy slipping back into decline. Then what? Another huge stimulus? That’s been my prediction all along. But the markets have absolutely no appetite for any more deficit spending.
Patience is running short. I think that soon, in the coming months, we’re going to see the economic you-know-what hit the fan.
By the way, the following are charts of the data presented in spreadsheet above: