The August jobs numbers are disappointing. The economy gained 169,000 non-farm payroll jobs, below the estimated figure of 175,000. Much worse, however, were the downward revisions for past months. July’s job numbers went down 58,000. The total revision for June and July is 74,000 less than previously expected. Then there is the labor participation rate: It dropped to 63.2 percent. It hasn’t been this low since 1978. Because so many people have left the work force, the percent of unemployed (i.e. those who haven’t checked out of the job market) went down to 7.3 percent.
It is long since past the time that we can attribute feeble job growth to the financial collapse in 2008. The “recovery” started in the second half of 2009. What we see now is the Obama economy — more people out of the job market, minimal growth and tepid job creation. The president is right — we are no longer in a tailspin. The TARP and other financial measures that President George W. Bush put in place and Obama continued staunched the bleeding long ago. But we have a listless economy, a function of combined tax, regulatory and budget policies.
The economy has not returned to the pre-Obama years and the recovery is a pale imitation of the Reagan recovery. So long as the low fog of Obama’s policies hang over the private sector there won’t be an economic breakthrough. For that we will need tax, immigration, regulatory, education and trade policies with one goal in mind: growth.