More Americans Working Part-Time

Because part-time workers are typically the first to be fired when economic conditions worsen, the gain in these types of jobs takes some of the shine off the drop in joblessness, said Neil Dutta, head of U.S. economics at Renaissance Macro Research LLC in New York.

“It’s an employment recovery built on thin ice,” said Dutta. “If there was an immediate downturn or even a weakness heading into the end of the year, who’s going to be the first one to go?” The jump in employees who are unable to find full-time jobs is what one would expect in an economy that is growing less than 2 percent at an annual rate, Dutta said.

Gross domestic product expanded at a 1.3 percent pace in the second quarter after growing 2 percent in the first three months of the year, according to figures from the Commerce Department. Part-time staff also receive fewer benefits. About 24 percent of these employees have access to medical benefits compared with 86 percent of full-time workers, according to data from the Bureau of Labor Statistics. Read more >>

2.5 million unemployed Americans were not counted as unemployed

October 5. Today’s employment report from the Bureau of Labor Statistics shows 114,000 new jobs in September and a drop in the rate of unemployment from 8.1% to 7.8%. As 114,000 new jobs are not sufficient to stay even with population growth, the drop in the unemployment rate is the result of not counting discouraged workers who are defined away as “not in the labor force.”

According to the BLS, “In September, 2.5 million persons were marginally attached to the labor force.” These individuals “wanted and were available for work,” but “they were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.”

In other words, 2.5 million unemployed Americans were not counted as unemployed. The stock market rose on the phony good news. Bloomberg’s headline: “U.S. Stocks Rise as Unemployment Rate Unexpectedly Drops,” http://www.bloomberg.com/news/2012-10-05/u-s-stock-futures-little-changed-before-payrolls-report.html .

A truer picture of the dire employment situation is provided by the 600,000 rise over the previous month in involuntary part-time workers. According to the BLS, “These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.” Turning to the 114,000 new jobs, once again the jobs are concentrated in lowly paid domestic service jobs that cannot be offshored. Manufacturing jobs declined by 16,000. Read more >>