No Jobs Day
Given the shutdown of the federal government, the September employment and unemployment figures were not released as scheduled. With no new data, it is useful to step back and look at the broader employment situation.
Regardless of what happened in September, we know roughly where the labor market is based on prior months’ data, and it’s not good. The labor market needs to add more than 8 million jobs to get back to the pre-recession unemployment rate, and at the growth rate we’ve seen for the last few months, we won’t fill that gap before the end of the decade. The unemployment rate has decreased substantially since its peak of 10% in the fall of 2009, but the vast majority of that decrease has not been because unemployed workers have found work. Instead, the unemployment rate declined because millions of jobless workers simply stopped looking for work, or never even started, because job opportunities are so weak (and if a jobless worker is not actively seeking work, they are not counted as unemployed). The weak employment situation has translated into very weak wage growth, since employers simply do not have to pay sizeable wage increases to get and keep the workers they need when workers do not have other options. In other words, we have an anemic recovery due to an ongoing shortfall in demand, and the US labor market remains depressed.
For more on the effects of the shutdown, a blog post from EPI Policy and Research Director Josh Bivens provides some useful perspective on its macroeconomic impact in the context of a weak, fragile recovery.