American Economy Still Down by 5.9 Million Jobs Since 2008

J Pat Carter/AP Photo
J Pat Carter/AP Photo
Newport Beach, CA

The Bureau of Labor Statistics (BLS) just published the Job Openings and Labor Turnover Summary (JOLTS) report for February. The job openings percent for the workforce hit a 14 year high of 5.1 million, while the layoffs and discharges percentage stayed at a historic low. But despite the job availability rate more than doubling since 2009, the hiring rate only grew by 30 percent in the same period. Adjusted for population growth, the American economy is still down by 5.9 million jobs.

The Obama Administration is touting the economy’s tremendous strength as demonstrated by a 5.5 percent unemployment rate, the lowest level since 2008. But despite a 14.9 million increase in the U.S. population, the number of people working only grew by only 2.6 million jobs since 2008.

The Administration has not commented on the fact that adjusting for population growth, there are about 8.5 million Americans that became discouraged and dropped out of the labor force since 2008. The “labor participation rate” fell from 66.1 to 62.7 percent. The result is that there is now about 1 less in the average number of jobs available for every 20 Americans interested in working.

The current abysmal participation rate is the worst since 1980. Adjusting for population growth and subtracting the number of people that gave up looking means that the net job growth in America over the last seven years is a negative -5.9 million jobs.

The Obama Administration has been pushing its ‘Stand with Women’ campaign, supposedly to expand women’s economic security in the 21st Century. From 1950 through 2010, women’s employment percentage consistently rose, while men’s fell. Both men’s and women’s employment percentage have fallen since 2010. But since 2010, women’s employment has fallen faster than men’s for the first time in 60 years.

Taking a look at what age group took the biggest hit from the fall in the labor participation rate; both female and male millennials age 25 to 34 years suffered the worst age group pain. Adjusted for population, both men and women millennials suffered about the same 8 percent plunge.

Senior Data Scientist Jacob Bollinger with analyzed 70 million job postings to quantify the five most in-demand jobs. According to his analysis:

  • 1) Laborers and Freight, Stock, and Material Movers and Handlers = median pay rate of $11.49 per hour;
  • 2) Accountants and Auditors = median pay rate of $30.55 per hour;
  • 3) Software Developers, Systems Software = median pay rate of A$47.59 per hour;
  • 4) Occupational Therapists = median pay rate of $36.25 per hour; and
  • 5) General and Operations Managers = median pay rate of $45.88 per hour.

Each month for the last year,  the BLS has been reporting a trend of about 4.9 million hires and 4.7 million  voluntary and involuntary job separations. That means the net number of jobs is growing by about 2.4 million per year. But with the population growing at 2 million per year, the economy has only been adding about 400,000 jobs each year.

Given that America is short 5.9 million jobs, it will take over 15 years at the current net hiring rate for American employment to return to an equivalent level to 2008.