On the December Jobs Numbers Posted by Christina Romer on January 08, 2010 at 09:37 AM EST
Today’s employment report, though a setback from November, is consistent with the gradual labor market stabilization we have been seeing over the last several months.
Payroll employment declined 85,000 in December. To put this number in perspective, employment declined 139,000 in September and 127,000 in October. So, in a broad sense the trend toward moderating job loss is continuing. This trend is particularly obvious in the quarterly pattern: average monthly job loss was 691,000 in the first quarter of 2009, 428,000 in the second quarter, 199,000 in the third quarter, and 69,000 in the fourth quarter.
Revised data now show that employment increased 4,000 in November. This is obviously welcome news and the first employment increase in 23 months. Compared with the unexpectedly good report for November, December’s job loss is a slight setback. Two industries where employment declined significantly were construction (-53,000) and wholesale and retail trade (-28,400). One continuing sign of labor market healing was that temporary help services, which is often a leading indicator of labor demand, added 46,500 jobs in December. Both the work week and aggregate hours remained stable, maintaining the significant improvement that occurred in November. The unemployment rate remained at 10.0 percent in December. This level reflected a proportional decline in the number of people unemployed and the number of people in the labor force. The unemployment rate remains unacceptably high, which underscores the need for responsible actions to jumpstart private-sector job creation.
As the President has said for a year, the road to recovery will not be a straight line. The monthly employment and unemployment numbers are volatile and subject to substantial revision. Therefore, it is important not to read too much into any one monthly report, positive or negative. It is essential that we continue our efforts to move in the right direction and replace job losses with robust job gains.
JOBS / ECONOMY TALKING POINTS
• Today’s jobs numbers show we have more work to do. While the overall trend is in the right direction, a 10.0% percent unemployment rate is unacceptable.
• President Obama said a year ago that the road to recovery would not be straight and smooth. In November we gained jobs for the first time since the recession began in 2007. Last month we lost jobs.
• We will not wait passively for the jobs to come back. We will continue to doing everything we can every single day to create jobs.
• Today the President will be announcing new Recovery Act funding and calling for a new round of tax credits for clean technology manufacturing that will support tens of thousands of new domestic manufacturing jobs.
• In coming weeks, the President will be working with Congress to pass new incentives to get small businesses hiring again, to invest in infrastructure, and to promote growth in our clean energy economy.
• We will also continue to fight for health care reform. Cutting health care costs will result in higher standards of living for American workers, greater private sector job creation, and lower budget deficits.
• We’ve come a long way. At the beginning of last year (Q1), the economy was losing 700,000 jobs a month. By the end (Q4), it was one-tenth that. But that’s not nearly good enough.
• Economists say that the recession is over. The reality is that there are still millions of Americans looking for jobs and an economy that needs rebuilding.
• For too long, Washington did what was easy instead of what was right. We cannot and we will not go back. We will continue to rebuild our economy stronger than before. We will address health care costs, build a competitive, educated workforce, ensure our energy independence, and make the middle class accessible for every American.