The Department of Labor announced that jobless claims were down from 9 to 8.04 percent in November, the single largest decline since March 2009. The fraction translates into roughly 120,000 new jobs created by private employers. However, the report grimly noted that the decline in jobless claims was also partly due to workers giving up looking for jobs in the grim labor market, particularly women.
The report also revised higher the average number of jobs created each month to 143,00 over the three-month period going back to September, an average that is higher than the historic low from May to August, in which anemic job growth signaled the unwillingness of investors and firms to take on new workers at the height of the European debt crisis and the earthquake in Japan that disrupted shipping and supply chains globally.
This November job “rally” can be traced in large part to retailers who added temp workers during the holiday season, so it is unclear whether there is cause for celebration as the transient nature of these 50,000 jobs may become all too apparent in January when retailers let go of their seasonal workers. (Can we expect a rise in jobless claims after the holidays?) In addition, this year’s record-breaking figures by retailers for Black Friday also improved prospects that consumers are more willing to spend in the hopes of a brighter economic future.
However, while economists are claiming that the labor report shows the economy is “improving at a faster clip,” the real news on the ground is that anemic job growth is hampering the economic recovery as workers without jobs spend less on goods and services and firms continue to find ways of cutting workers in order to bolster their bottom lines. The seasonal affective disorder known as “holiday shopping” is only a temporary respite from the really bad news, which is that the real wages of Americans are down and their credit card debt is on the rise again.
These are “not” the signs of a healthily recovering economy, but given the dismal performance and prospects of economic growth in the near future, economists, politicians and investors alike are holding onto this bare bit of news that jobless claims are down, literally, by .06 percent. This is an embarrassing piece of evidence that sound economic policy, which must include job creation (thank you very much, Republicans, for voting against jobs for Americans), has been substituted for the rather conventional approach of grasping at straws in a rising flood.