SMALL PRIVATE SECTOR JOB GAINS NOT ENOUGH TO DENT UNEMPLOYMENT
“Overall, today’s report on the employment situation was fairly lackluster. The job market appears to be stuck in neutral as employers hang on to the workers they have, but are unable or unwilling to add new workers. As a result, private sector payrolls grew by just 67,000 in August, well short of the level needed to make a dent in unemployment,” said John A. Challenger, chief executive officer of global outplacement consultancy Challenger, Gray & Christmas, Inc.
In the household survey, which is used to determine the unemployment rate and more likely to capture the number of Americans who are self-employed or working for very small firms, employment gains of 290,000 were offset by 261,000 added to the ranks of the unemployed. Some of the newly unemployed may not have lost their jobs. Instead, they may have re-entered the labor force after sitting on the sidelines. The number of people categorized as not in the labor force fell by 341,000.
Other statistics were also mixed. The number of people unemployed 27 weeks or longer fell by 323,000. However, the number of people working part-time because of slack business conditions or lack of full-time positions increased by 331,000. This suggests that more people are simply trying to get their foot in the door by taking part-time assignments.
“The job market has a long way to go before it starts to look and feel like a recovery, which makes stagnant reports like today’s all the more frustrating. Progress is indeed being made, but it is occurring in such small increments and it is so tenuous that it doesn’t seem like progress at all. It is also important to remember that today’s numbers are the national averages; the view from 30,000 feet. Down on the ground, in the cities and towns, the reality is probably much different. In some areas, the situation may actually be better than today’s report suggests. Unfortunately, in many areas, the situation is far worse,” said Challenger.