The news of the economy is good.
That seems to be the message behind the statistics released this week by the U.S. Labor Department: Employers added 209,000 jobs in July. That dropped the unemployment rate down to 4.3 percent, tying a 16-year low. Wall Street ran with that news, and the Dow Jones industrial average gained 66 points to close at 22,092 — its eighth straight record high.
In fact, the news is even better than that. The economic picture is not one of a surge in one or two areas, like high-tech and energy, but of a trend, a broad upswing almost across the board: Over 60 percent of the industries that make up the employment survey added jobs during the month of July. The figures exceeded expert expectations, something that even the experts can feel good about.
In some cases, it’s not people who are looking for work, but companies who are looking for workers. In Tennessee, for example, Nashville’s been booming for some time, but now Memphis is rallying too.
“Full employment” looks like it might be just another federal jobs report away. Of course, “full employment” is a term of art, meaning not zero unemployment, but that all eligible people seeking work can find it at prevailing wages. But even by that definition, the economy is almost there.
Just as the Recession of 2008 affected different parts of the country and different segments of the population unevenly, so too this recovery has been uneven. It’s not a boom time for everyone, to say the least. This week’s nice numbers notwithstanding, many people will continue to feel like the calendar page never moved from 2008.
In other words, things are better than they’ve been in a long time — and getting worse.
For millions, as the economy has slowly struggled out of recession, their personal situation only got worse. The scourge of long-term unemployment persists despite the recovery. Nearly 3 million people — about one-third of all the jobless — have been out of work for 27 weeks or longer, according to a recent report from the Bureau of Labor Statistics. For them, with every passing month, the situation only gets worse. The economy seems to be leaving them behind.
Even for those who are working, purchasing power and consumer spending has not paralleled the soaring growth figures. That’s because wages have increased only 2.5 percent in the past year; lower than the historical average, and no better than over the past eight years.
The 25-to-54-year-old employment rate continues to carry a heavy burden of unemployment and underemployment.
“Once your age hits the wrong side of 40, nobody wants you,” Brian Perry of Rumford, Rhode Island, told the Los Angeles Times. A notable victim of the Great Recession, he was laid off after 16 years as a clerk with the same law firm, and has been searching for steady work ever since.
“I’ve been on interviews, and I’d swear the interviewer was counting the gray hairs on the top of my head. It wasn’t an eyeball-to-eyeball conversation. It was an eyeball-to-the-top-of-the-head conversation.”
Perry lost his house and exhausted his unemployment insurance while making literally thousands of job applications. Lunch has at times come down to a choice between an apple and a banana. But he hasn’t given up, and one hopes that he will be among the fortunate ones to benefit from the current trend.
The elation over the new economic statistics is tempered by awareness that it can promise little or nothing for the future. There is no feeling that the country has turned a corner and hard times are behind us. Rather, there is a nagging uncertainty about the good news. People sense how fragile is the improvement and that the next batch of statistics could be laden with woe. No one can say with any confidence that the 2008 Recession is finally over and there’s no going back to it.
Some point to productivity as a key indicator.
“You can’t declare victory on the economy until you see that productivity number shift,” economist Douglas Holtz-Eakin said. He called it the “Achilles’ heel” of this recovery.
To address that, Holtz-Eakin urges Congress to make good on promises of a tax overhaul. “I think a serious pro-growth tax reform could be the single biggest impact on growth, maybe as big as 0.5 percent higher GDP,” he said.
In addition, the government has to come through with a serious program for retraining workers who have been laid off, and helping them to cope with changes in the workplace. And to think hard about how to help the American worker adapt to the accelerating pace of automation. It’s not in the future; it’s in the present.
However, it must be said that to rely only on the government to answer this urgent need would be a grievous shirking of our responsibilities. Each community and each individual has to take responsibility for alleviating the desperate situation in which so many people find themselves due to economic forces beyond their control.
One doesn’t have to be a government official or an employer to help. Just looking out for job openings that might be suitable for a friend or neighbor could make a difference. It doesn’t cost anything, except a little bit of time and a lot of heart.