We’re backsliding. And we don’t have to be.
Here’s how bad the June jobs numbers were: We didn’t just add too few jobs to keep up with the recovery. We added about 100,000 fewer jobs than we’d need to keep up with population growth.
That’s stacked on top of the also-terrible numbers we got in May, which showed that we’d added about 60,000 too few jobs to keep up with population growth. And we’ve been flat for even longer than that. The Bureau of Labor Statistics says that since March, “the number of unemployed persons has increased by 545,000, and the unemployment rate has risen by 0.4 percentage point.” The share of adults in the labor force is now 58.2 percent which, as David Leonhardt notes, means it’s as low as at anytime since the beginning of the recession. We’re not recovering. We’re backsliding.
And Washington is making it worse. The Federal Reserve has ended its underpowered QE2 program and has no plans to replace it with QE3. Congress has is ending a variety of stimulus programs and shows every intention of either moving immediately to austerity, or nearly defaulting on the national debt and then, after causing economic chaos, moving immediately to some form of austerity. So the two institutions capable of helping the economy lift itself up are, instead, pressuring it to stay down.
We could do more. We should do more. But Congress won’t do anything more. The labor market, initially rocked by a financial crisis, is now stagnating because of a political one.