The august jobs report was generally seen in the news as good news. The president said "it is good,but not good enough."Some headlines said "hiring picking up" Some said it was better than expected and therefore good.The stock market even responded with some very positive increases.
This is all sugar coating or putting lipstick on a pig. The job report sucks. When looking at employment numbers I only consider the private sector to negate the effects of the census workers.The first four months of 2010 were looking pretty good for jobs .In january we added about 4000 jobs.Nothing to brag about here , but each month through april the numbers keep raising sharply to about 250000 in april.Things were looking pretty good then but then everything fell apart.In may new jobs dropped to 50000 and have wobbled around since then to 67000 jobs in august.To keep up with the segment of population growth entering the job market we must add 120000 jobs a month just to keep the unemployment rate the same.The only good number in the report showed average hours worked ticked up 6 min. a week.This is a forecaster of future hiring but I just do not see it happening soon.
In a previous blog I noted that uncertainty is a job killer and we still have plenty and our administration is doint nothing to reduce it. The private job sector will not take risk and hire if uncertainty is high.No one knows the true costs of obamacare,we do not know what our taxes will be,we fear the costs of possible cap and trade and given the huge and growing debt. we do not know what inflation and interest rates will do,and what government interference in the private sector will be thrown into the mix.The future is not looking good.
I have a friend and customer who has testified before congress on helping improve our exports. A nobel task. He believes the future costs of obamacare will raise his health care costs 100 % in five years.He is trying to expand his business.He is hiring Americans,buying U.S. equipment and exporting. Since he has 135 employees and expects his health care costs to double in five years do not think that doesnt put a damper on his hiring and investment.
So we saw a nice uptrend from jan. to may then dismal job creation.What happened in may was the Greece financial crisis.While we do not count Greece in our jobs numbers, what it did was drive home the message that yes it could happen here. We already have a few states,is Calif. and Ill. that are essentially in the same position as Greece and our federal situation is not far behind.Again it is fear and uncertainty, caused by our own government that is hurting future economic growth.
The stock market took a good bounce on the numbers because fear of a double dip were already priced into the market and positive jobs numbers help to alleviate that fear.
So once again, if we want jobs to come, the government must get out of the way and quit taking actions that actually cripple growth.