Key monthly job numbers come from two different surveys, and at times they seem to describe different economies. For June, results of the Bureau of Labor Statistics’ (BLS) survey of 60,000 households looked bad. Unemployment rose by a tenth of a point to 5.9% and the number of employed people fell a bit. But the payroll survey of 144,000 business and government organizations found a healthy increase of 850,000 non-farm jobs. That was the best showing in months.
From the household survey we learned that the unemployment rate for African Americans (9.2%) was, as usual, almost double the white rate of 5.2%. The Latino rate fell to 7.3% and the Asian heritage rate to 5.8%. Other highlights include the fact that the number of involuntary part-timers—people who want full-time work but can’t find it—fell from 5.3 million to 4.6 million.
So, the household survey showed unemployment up and the payroll survey showed lots of new jobs. Few commentators seem to be worried about the discordance. It’s happened before; both in relatively good times and in the early 2000s, as the economy wain a slow crawl out of the 2001recession. I saw no pattern as between recessions and non-recessionary periods. It is a very freakish situation; the experts, including BLS staff, have never offered a credible explanati
In general, it is best to watch trends rather than a single month. And obviously, many trends are still dismal. In June, job totals in the household survey were still 7.2 million below their level in February 2020. Also, since then and despite COVID deaths and restricted immigration, the non-institutionalized adult population increased by 1.7 million. Right now, we need 9 million jobs to get back to pre-pandemic normal.
However, pre-pandemic normal was not real full employment. The official unemployment rate back in February of 2020 may have looked good at 3.5%, but, according to the National Jobs for All Network’s (NJFAN) Full Count, real unemployment was 8.9%. NJFAN added 5 million people who wanted jobs but weren’t currently searching, and 4.3 million part-timers who wanted full-time work. For June, 2021, with the official unemployment rate at 5.9%, NJFAN’s real unemployment rate was 12.2%. To wipe out unemployment, we may need as many as 20 million new good jobs. Adding that many jobs requires a large New-Deal style work projects. A medium-sized road-and-rail infrastructure program like the one being negotiated in Washington isn’t enough.
Can the “Labor Shortage” Improve Labor Conditions?
“Labor shortages” are still in the news, and there are many articles about the high rate of employee quits. More quits normally signal that people are confident about finding new jobs. The rate was 2.5% of the work force in May. That’s not much higher than in 2019, but workers are not supposed to quit their jobs in hard times. They should be grateful for any kind of job, right? In recent decades employers have not had to exert themselves much to find employees. Some are having to try harder just now, but most aren’t in any rush to substantially improve job quality. Some have had to raise wages, while others are replacing workers with machines rather than pay $14 or $15 an hour. In Republican-controlled states, politicians want to make unemployed people more desperate. They have turned back the federal unemployment bonus of $300 and are cutting other programs.
I have not seen any scholarly support for the conservative idea that the $300 benefit has been a major reason why people are reluctant to go back to work. But it may be one factor, in combination with other things, including worries about getting COVID, child-care responsibilities, and the great “reallocation,” as it is called. Quite a few people have had time to reflect on their career options. Some don’t want to give up working at home. Some lucky people have decided to stop working; retirements are on the rise.
Those who need jobs are reluctant to sign up at workplaces where pay is lousy, benefits sparse, and managers and customers nasty. Other folks are adding to their skill sets. Luis Herrera told the Los Angeles Times that after being laid off from a food-service job, he earned a high school diploma and found a new job that paid much more. But that can’t be everybody’s solution.
Real unemployment will stay high, and that weakens employee bargaining leverage. As government income supports are pared back and savings shrink, workers’ reflections on new careers will be cut short. In any case, a big rethink by individuals about changing careers can’t, of itself, bring structural change in labor markets. That requires political work, organization, and solidarity with low-wage workers.