Deeper look at jobs report is sobering

Mark Mercer and his two dogs, Stanley and Oliver, stand along Market Street in Philadelphia on Aug. 14, 2013. He has been out of work since 2011 and has applied for work the old-fashion way to no avail. This summer he began standing in the city's financial district with a sign that reads,"I don't want your change. I need a job." (David Maialetti / Staff Photographer)
Mark Mercer and his two dogs, Stanley and Oliver, stand along Market Street in Philadelphia on Aug. 14, 2013. He has been out of work since 2011 and has applied for work the old-fashion way to no avail. This summer he began standing in the city's financial district with a sign that reads,"I don't want your change. I need a job." (David Maialetti / Staff Photographer)
Posted: June 08, 2014

For the first time in six years, the nation's payrolls have made up for the jobs lost during the worst recession since the Great Depression.

In May, payrolls expanded by 217,000 jobs to 138,463,000, the U.S. Labor Department reported Friday. That's the highest level since the 138,365,000 reported in January 2008, a month after the recession began.

The unemployment rate remained unchanged at 6.3 percent.

"For those still unemployed, this report is positive because it shows things are getting better - not because of the headline that we've 'recovered' all the lost jobs," said Joe Weinlick, a vice president at Beyond.com, a King of Prussia operator of online job boards.

"The good news is that there are more opportunities for job seekers," he said.

Even though the recession officially ended nearly five years ago, in June 2009, the jobs situation had not, at that point, reached its worst.

That happened in February 2010, when the number of payroll jobs declined to 129,655,000, a loss of 8.7 million from the start of the recession.

In May, private-sector jobs were added in durable goods, manufacturing, construction, retailing, financial services, business and professional services, education and health, and leisure and hospitality. Government hiring was also up.

There were declines in food manufacturing, the motion picture business, legal services, and appliance and electronics sales. Local government hiring offset declines on state and federal levels.

"With the most recent employment data, the economy has recaptured all the jobs that were lost during the recession, and is now beginning to show incremental employment growth from over six years ago," said Doug Handler, chief U.S. economist at IHS Global Insight.

"We speculate that the first such incremental job is a barista at a local coffee shop - 31,700 jobs were created in food service and drinking places in May," he said.

"While the economy has generated 2.369 million jobs during the last year, a major concern remains the quality of these jobs," he said.

"Of these jobs, 388,000 were in administrative services, 317,000 in retail, and 311,000 in food and beverage establishments - all low-wage sectors," he said.

In a sign of slow recovery, the labor participation rate, the percentage of people of employment age who are working or looking for work, remained unchanged at 62.8 percent, the lowest since February 1978.

In all, 19.2 million people are unemployed, working part-time because they can't find full-time work, or have only sporadically looked for work, perhaps because they are too discouraged by their prospects.

Though the May milestone is significant, it does not mean the job market has been made whole.

In the 76 months since the start of the recession, the working-age population has grown. Economists estimate 100,000 new jobs are needed each month to keep up with the growth.

That means the economy still "owes" the nation's workers 7.6 million jobs.

In May, 9.8 million people were unemployed, up 46,000 from April, but down from 11.7 million unemployed a year ago. When the recession began, the unemployment rate was 5 percent. When it ended, it was 9.5 percent. In October 2009, unemployment reached 10 percent, and 15.4 million people were jobless.

"It sounds great on paper that unemployment is at the lowest point since 2008 unless you are one of the people who is out of work and can't pay your bills," said Bart Ruff, founder of My Career Transitions, a support group for the unemployed that meets at Pennsylvania State University's Great Valley campus.

Ruff said attendance was up at monthly meetings.

"It's still very tight in Philadelphia, and we still have this problem with the long-term unemployed," said John Dodds, director of the Philadelphia Unemployment Project, an advocacy group.

More than a third of those unemployed in May, or 3.4 million, have been out of work for more than 27 weeks.

By contrast, in January 2005, the catch-up month for the recession that began in March 2001, 7.8 million people were unemployed. Of them, just over one in five was out of work for more than six months.

Dodds' group has been pressing Congress to restart extra federally funded unemployment benefits that would follow the 26 weeks of benefits paid for by states. Extra benefits ended in December, leaving more than 260,000 people in New Jersey and Pennsylvania without unemployment insurance.

"The recovery is way too slow, and it's leaving way too many people behind," Dodds said. "We're just letting people go down the drain."


jvonbergen@phillynews.com

215-854-2769

@JaneVonBergen

www.inquirer.com/jobbing

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