Economy & Budget

Jobs figures and growth rates show economy in decline

Jobs figures and growth rates show economy in decline

WASHINGTON — Another weak jobs report came out last week, drawing yawns from Democrats, excuses from the White House, and shallow, incomplete reporting from the network news shows.

President Obama has just finished a string of speeches on jobs and the economy, issues that pollsters say are the voters’ biggest concerns, but failed to offer any new ideas about how to deal with them.

He traveled around the country repeating the same old ideas he’s pushed since 2009: public works spending for roads, bridges and other infrastructure. They are failed ideas that didn’t work before and won’t work now.

The bleak reality is that the Obama economy, which was growing at a snail’s-pace in his first term, is slowing down even more in his second.

Economic growth, as measured by our gross domestic product, grew at a barely breathing 1.4 percent annualized rate in the first six months of this year. That’s down from 2.5 percent over the same period in 2012. This isn’t just a statistic: It’s the falling pulse rate of the U.S. economy.

The Labor Department’s employment report last Friday showed the economy added a minuscule 162,000 jobs in July, out of a labor force of about 160 million Americans. A large number of these jobs were in temporary, part-time, low-paying work, and nowhere near levels needed to bring unemployment down to more normal levels.

Left out of many network news stories was the fact that the government also reduced its job-creation estimates for the previous two months, and said that workers not only earned less but worked fewer hours, too.

Obama has been saying for more than four and a half years that the economy’s getting better, that it is “moving in the right direction.” But the same could be said about a student who was getting F’s on his report card and is now getting D’s.

The news media had been hyping the expected jobs number for weeks, pushing the administration’s line — and that of independent forecasters — that July’s figures could top 200,000.

But the anemic, temp-heavy, 162,000 figure made all of those hyped jobs reports and claims that the U.S. was in a full recovery look ridiculous and even duplicitous.

The Washington Post, which had called previous subpar job figures “solid” or “robust,” now acknowledges the truth about the economy’s weakening performance. It’s that bad.

“July was supposed to mark the starting point for an amped-up economy. Instead, data on Friday showed the recovery remains stuck in second gear,” the Post said in a front-page story that ran beneath this headline: “Sluggish hiring in July reflects tepid recovery.”

The network news shows, which to a shameful degree have avoided any serious reporting about Obama’s sorry economic performance, didn’t give last week’s jobs story the detailed coverage it deserved.

NBC’s Brian Williams reported that the unemployment rate fell to 7.4 percent, but did not explain this was largely due to 240,000 discouraged job-seekers who left the labor force because they could not find work.

That’s right — many more long-term unemployed workers dropped out of the work force than found jobs last month.

When unemployed Americans are asked by the Bureau of Labor Statistics if they’re still looking for work, and they answer no, they are not counted among the unemployed. And that lowers the unemployment rate.

Most of the reduction in the jobless rate under Obama’s presidency has been the result of people who have given up looking for work. And that’s led to a fast-shrinking labor force, an ominous sign of an economy in long-term decline.

“For most working families and recent college graduates the situation is grim,” because the jobless rate is far worse than the government’s 7.4 percent figure, says University of Maryland business economist Peter Morici.

“Adding in discouraged adults and part-timers who want full-time employment, the unemployment rate becomes 14 percent,” he says.

The economy isn’t producing enough jobs to keep up with population growth. We would need to create at least 360,000 jobs a month to lower the unemployment rate to 6 percent, which would require an economic growth rate of 4 to 5 percent. “Over the last four years, the pace has been a paltry 2.2 percent,” Morici says.

Obama’s advisers dismiss the possibility of such higher economic growth rates, saying slower growth is "the new normal." But four years into Reagan’s swift recovery, which followed a deeper recession than Obama has had to deal with, the quarterly growth rates were 8.5, 7.9, 6.9 and 5.8 percent.

What never gets mentioned in any of the network news stories about the economy is that slower growth and high unemployment are the result of Obama’s anti-growth, anti-job creation policies. Among them:

Energy policies that have boosted fuel costs, killed jobs and flattened family budgets; opposition to any new export expansion agreements to open emerging markets for U.S. goods and services; and higher tax rates on investors that have reduced new job-creating, start-up enterprises.

Democrats and Republicans in Congress are working on a sweeping tax reform plan to eliminate loopholes and lower business and individual tax rates to boost economic growth. Obama has given their idea the cold shoulder.

Notably, people are beginning to speak out much more forcefully about Obama’s economic record. Last week’s jobs report was “consistent with a sluggish, lackluster economy,” says Alan MacEachin, an economist at the Navy Federal Credit Union. Well said.

This week, the Gallup Poll said “Americans’ confidence in the economy … was the lowest it has been in any month since April,” slipping to minus-12 last month. The president’s job approval score has fallen into the mid-40s.

Maybe the American people are finally beginning to put two and two together.

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