Seven years after the partial real estate correction that tanked America’s debt-fueled paper economy, the head of President Obama’s economic brain trust claims that the U.S. is “finishing 2013 in a stronger place” — ignoring a 30-year low in job participation and unprecedented weakness in job growth.
“The strengthening of the economy over the course of 2013 is a testament to America’s resilient private sector and America’s workers,” Council of Economic Advisers Chairman Jason Furman wrote Thursday. “Businesses have added 8.1 million jobs over the past 45 months, and are on track to register the third consecutive year of job growth in excess of two million.”
This level of job creation, which comes to 180,000 jobs per month, means that the United States would not return to a pre-recession level of employment until close to the end of this decade.
According to HamiltonProject.org’s chart of the so-called jobs gap, this rate of job creation would not return the U.S. economy to the January 2008 level of employment until October of 2019.
Job creation picked up somewhat in October and November, when the effects of the government shutdown and the now-dead budget sequester where at their peak. Some 204,000 jobs were created in October and 203,000 in November.
However, the monthly average over the last six months has been a paltry 182,500, a rate that would return us to pre-recession employment in August 2019. This level of job creation hardly qualifies as a recovery for Americans — 80 percent of whom believe the economy is still in recession, according to a recent ABC News/Washington Post poll. (RELATED: Rich get richer, rest stagnate in economic ‘recovery’)
Furman also bypasses a long-term drop in the labor force participation rate that has left the U.S. work force, as a percentage of the total population, smaller than it was during the administration of President Jimmy Carter.
Labor force participation, the Labor Department’s measure of how many American adults are in the job market (even if they are only seeking employment but not employed), has dropped precipitously during the Obama administration. Despite a slight uptick in November, and despite widespread talk of an economic recovery, the labor force participation rate has tanked through most of 2013.
The low labor force participation rate can’t be blamed entirely on the sitting president, because it has been in steady decline for most of the last ten years.
More ominously, labor force participation, which increased strongly throughout the second half of the 20th century, peaked in the late 1990s and has declined more or less steadily ever since — raising the strong possibility that the weak jobs market has no relation to the president at all but results from forces Obama can neither comprehend nor control.
Economists offer a range of explanations for why labor force participation is so awful. In a March study for the American Enterprise Institute, University of Michigan economist Mark J. Perry suggested long-term economic trends, including the aging of the workforce and retirement of the baby boomers, account for about half of the low rate.