The federal government’s latest monthly job report reflects at least two troubling trends. One is that private hiring continues to slow down. The other is that governments at all levels laid off employees at a near record pace in September. Neither bodes well for the economy. And taken together, the two trends suggest that Americans will soon suffer the negative consequences of a steeper slump under Republican zeal to make stimulus spending a political toxin.
Private hiring slumped to just 64,000 net new jobs last month, well below the 93,000 gain in August and the 117,000 jobs added in July, the Labor Department reported. Meanwhile, the number of employees cut loose by local, state and federal governments soared to 159,000, driven largely by the discharge of local government workers at the fastest rate in nearly 30 years. That left the economy with a net loss of 95,000 nonfarm jobs for September – a sharp reversal from the eight straight months of job gains previously posted under the Obama administration.
One grim but notable statistic that jumps out is the loss of 72,000 teachers and other education-related jobs in September. That loss is extremely disheartening. Given the continued rise in the nation’s population, the need is for even more – not fewer – classrooms and teachers to wage the fight for a better educated workforce to compete in a stiffening global market place.
The massive loss of teaching jobs suggests the United States will continue to fall further behind global competition, not catch up. It is also likely to make it harder for schools to negate the negative social dynamic of drop-outs and poor achievement that perpetuate poverty and wasted potential, and undermine every community’s qualify of life and economic improvement.
It’s hard not to see where the job trends are heading. The chief worry is a double-dip recession and an extended period of deflation that could drive a downward spiral of even more joblessness and, more perniciously, more under-employment. Beneath the figures, there is already evidence of such a precipitous trend.
The economy, for example, needs to be adding at least 150,000 jobs just to absorb new workers entering the workforce, and to keep the current 9.6 percent unemployment flat. That unemployment rate, to be sure, is awful. Normal had been around 4 percent to 6 percent. Yet the current rate, by other indices, is worse than it looks.
It does not reflect the 3.5 million Americans who have either quit looking for work or stayed out of the job hunt, and thus are not officially counted among the ranks of the unemployed. Nor does it reflect the fact that hourly wages remain stagnant, or that people who have gone several years without a pay raise are falling behind the present pace of cost-of-living adjustments in the price of groceries, utility bills and other goods and services.
The number of hours worked and weekly earnings in most businesses also remain flat. That suggests scant likelihood of a pending surge in employment, and certainly nowhere near the level of several hundred thousand new jobs monthly that will be needed to bring down the rate of unemployment.
Businesses, moreover, are sitting on an astonishing cash reserve of $1.6 trillion, or buying back shares from stockholders, while waiting for the green light of renewed business investment and consumer spending.
Neither will happen while Republicans are resisting the Obama administration’s effort to pass new business tax credits and adopt new infrastructure and energy efficiency investments. Each proposal should be a no-brainer: they would stimulate efficient stimulus and build real long-term infrastructure gains.
Most new federal spending has been to save or create jobs to dig the economy out of the Great Recession, and to ease the burden of unemployment. But Republicans seem determined to preach their scare-tactic chorus against stimulus spending to hold a double-dip recession at bay, and to lead the way backwards for political gain. Americans have a clear choice in November between a better economy, or more misery.