A Lifeless Remission?

The latest US jobs report is out, and again, the phrase "jobless recovery" is being thrown around by politicians and journalists alike. This time, however, the talking heads are in rush to claim that the latest stats show that the recovery won't be jobless for long...or so they hope.

The American economy lost 36,000 jobs in February, but this is significantly less than had been predicted. Expectations were low in part due to the recent US snowstorms, although negative effects from the harsh weather didn't materialize. In a country whose health depends heavily consumer spending, more employment means more growth...so is it time to get optimistic?

Good News That Employment is Down

"It's good news. Everybody was doubting the sustainability of the U.S. recovery without more jobs. That's why this report is so important," said Stéfane Marion, chief economist at the National Bank.

Once we see the numbers for March, said Gault, the job gain could be over 100,000. Private payrolls should be growing in a sustained way from now on, he predicted."

Predicting more job growth in March? Sounds great...however, where will these jobs come from, is the question. There is speculation that when the all of the snow melts from the recent blizzards, there will be a surge in employment. A little odd considering that the report refuted that the snow had any impact on job loss, so why would its absence cause a boost? If anything, there are going to be a lot of unemployed maintenance and snow-removal specialists out there. So here's the real answer:

Snow Didn't Skew the Unemployment Rate, But the Census Will

Around half a million temporary census workers will begin being added to the American payroll. Similar to that mysterious service-sector employment boost that happens each year around November and December, these jobs are part-time, transient, and pay low wages (for the Census worker, a base hourly is around $11). As the above article discusses, these jobs will do virtually nothing to aid the economic recovery or add to the average income of the American worker. Nothing, that is, aside from masking true unemployment figures.

The recession has been declared over. The fact that 70 percent of the American GDP is based on consumer spending - and the fact that 16 percent of Americans are unemployed or underemployed - seems to be inconvenient to the desired message that we are out of the woods. And so the the term "jobless recovery" was coined. I wish I was as talented as the US spindocters. It's like using "lifeless remission" to describe a cancer patient wasting away on life support.