Unemployment Holds Steady

Pundits are ebullient over the .2% drop in unemployment in November and the sense that employers have finally stopped hemorrhaging jobs. The less charitable interpretation of the latest employment numbers is that 10% unemployment lingers across the land. Consider these additional facts - is there good or bad news among them?

• 15M Americans remain out of work.
• Businesses have begun hiring more temporary workers.
• Average weekly wages increase by .67%.
• Employees worked yet longer hours.

The conventional interpretation is optimistic if unpleasant: employers have squeezed the last remaining sweat of productivity from their workers, and finally have to bring on employees. Temp hires often become full-time hires. Real job creation will happen in March, assuming the economy continues to grow.

I'm no labor economist, but temp employment always sets me on edge, as often long-term temp relationships leave workers with the worst of both worlds: the demands of full-time work with none of the benefits. At the same time, I'm happy to see more workers employed at the holiday season, when millions of households are trying to bring some joy and food into their worlds.

Despite the rosier view put forth by the Administration on the heels of this week's jobs summit, we're facing a new American reality in the coming years:

“Assuming we have a strong recovery, it will take at least five years or more to get the unemployment rate down to a more normal 5 percent,” said Jan Hatzius, chief domestic economist at Goldman Sachs, adding that the long-term unemployed have lost skills and some of the habits of work because of their extended idleness. Because of this, the nation may have to get used to an unemployment rate that seldom falls below 6 percent.

We're really going to have to think creatively about job creation, providing new educational opportunities for idle Americans, and solidifying our safety net in the coming years.

(Photo by Ben Sutherland, taken in the UK)