December Jobs Report: "Not Enough"

By Sharon Post, CPEG.

The theme of this month’s jobs report ought to be “not enough.” The latest disappointing numbers are far lower than the optimistic expectations voiced by many economists after ADP reported payroll growth of 238,000 in Dec. 2013. The Chicago Political Economy Group (CPEG) has been arguing for years that what job growth the U.S. economy has seen since the official end of the “great recession” has been inadequate. In fact, the total number of employed workers in the U.S. is still lower than it was before the start of the great recession.  The federal Bureau of Labor Statistics (BLS) announced this morning that the economy added 74,000 jobs in Dec. 2013, falling far short of expectations. This anemic job growth brings the total employment in the country to less than what it was in Nov. 2007, the month before the great recession started. It’s important to note that if the economy had added the 200,000+ jobs that many expected, we would still not have reached pre-recession employment levels. Even a “good” jobs report would have been disappointing.

The BLS employment report for December 2013 comes out in the context of terminated emergency unemployment benefits; the departing Federal Reserve chairman citing “fiscal drag” to explain persistent unemployment, and a dramatic demonstration of how our economy is failing: Even people with jobs as skilled manufacturing workers at Boeing gave into huge concessionary demands from management. The political debates that dominate the headlines are about where to place the chairs on the deck of the Titanic. In the meantime, the people whose lives are affected by the outcome of those debates continue to suffer.

What’s more, the number of people who have been unemployed for 27 weeks or longer remains stubbornly high at 3.9 million people. Those long-term unemployed constitute 37.7 percent of the total unemployed, still higher than in June 2009 when the recession officially ended (29.7 percent) and much higher than before the recession started in November 2007 (19.3 percent).

As many as 1.3 million of those long-term unemployed lost their jobless benefits when Congress declined to extend emergency unemployment insurance. If the House doesn’t pass the Senate’s bill to renew those benefits, five million workers will lose access to this crucial income support over the course of 2014.

It’s clear that we have not done enough for workers who have been left behind by the so-called recovery. The long-term unemployed in 2013 had a smaller chance of finding a job in a given month —only 12 percent — than other workers and are also worse off in the job market than the long-term unemployed were in 2007.  The truth is that people who are out of work for only a few weeks are more likely to become part of the devastated long-term unemployed group than they were in 2007. Finding work is especially hard for people who have been jobless for more than six months, but the chance of finding a job is still lower for all unemployed workers than it was before the recession.


Terminating unemployment benefits when the deck is stacked so heavily against unemployed workers is cruel. But not only is this the wrong time to cut off unemployment benefits for these workers, it is also the wrong time to congratulate ourselves if we win back those extended benefits. It’s not enough to pay workers to look for jobs that don’t exist, and that’s what we are doing if we extend emergency unemployment insurance without responding to the real emergency — an economy incapable of providing sufficient jobs.

From the bottom-up view it’s obvious that the labor market, left to its own devices, is not meeting the need for jobs. The labor market participation rate declined in December to 62.8 percent, indicating that some workers are dropping out of the job market altogether. While unemployed workers experience frustration and give up hope, workers with jobs are burdened by the fear of losing them.  A sign of this fear is the International Machinists Association members’ vote in December to accept a concessionary contract that sacrifices retirement security and fair wages in response to Boeing’s threat to leave Seattle and toss them out of work. The same workers had voted down a similar proposal, but the inhospitable climate for workers sends a chill through the entire labor force, leading to lower wages and greater insecurity.

Meanwhile, what job growth we did experience in December was largely in the retail sector, where workers are fighting across the country for a $15/hour base wage and the right to form a union. Those workers still have not lost hope, but they are not relying on policy makers or the market to correct the injustice of stagnant, poverty wages.  Elected leaders should take inspiration from the Fight for 15 and take real steps toward repairing the structural inequities in our economy. 

It’s not enough to extend unemployment benefits one more time without any real policy to create jobs, not enough to strike “grand bargains” with deficit hawks, and not enough to simply keep jobs in place while wage and benefit standards deteriorate.  An agenda that moves us out of the persisting employment crisis would include a federal jobs program like the one CPEG has proposed or the jobs program in Rep. John Conyers’ “The 21st Century Humphrey-Hawkins Full Employment and Training Act” (HR 1000); a tax on the trading of financial assets included in Rep. Keith Ellison’s “Inclusive Prosperity Act” (HR 1579); an increase in the minimum wage; and support for strong labor organizations that can build power for workers to protect the interests of American communities when they are threatened by overwhelming corporate power.

Sharon Post is director of the Center for Long-Term Care Reform at the Health and Medicine Policy Research Group and a member of the Chicago Political Economy Group.

Individually signed posts do not necessarily reflect the views of DSA as an organization or its leadership.


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