Economy and Jobs Watch: Unemployment Down, No New Jobs - January 12, 2004 Vol.5 No.1

January 12, 2004 Vol.5 No.1:

Published: 01/12/2004

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Economy and Jobs Watch: Unemployment Down, No New Jobs

With a strong quarter of economic growth in the July-September period, many observers were expecting to see employment strengthen in the last part of 2003. However, as recent economic data shows, the labor market remains very weak, as employment was “flat” last month.

In December, the unemployment rate dipped from 5.9 percent to 5.7 precent; however, this was purely a result of people leaving the labor market, and not due to increased employment (see table below).

                         |        Monthly data      |
                         |__________________________| Nov.-
        Category         |           2003           | Dec.
                         |__________________________| change
                         |  Oct.  |  Nov.  |  Dec.  |
_________________________|________|________|________|_______
     HOUSEHOLD DATA      |     Labor force status
Civilian labor force.....| 146,892| 147,187| 146,878|   -309
  Employment.............| 138,095| 138,533| 138,479|    -54
  Unemployment...........|   8,797|   8,653|   8,398|   -255
Not in labor force.......|  75,147|  75,093|  75,631|    538

Source: Bureau of Labor Statistics

According to the more accurate payroll survey, the total (non-farm) employment increased by a paltry 1,000 jobs. The data continues to reflect a failure of current policy to address the needs of the slumping labor market.

In addition, just before Christmas, the Bush administration allowed emergency federal unemployment benefits to expire, even though labor market conditions have not improved. Apparently, extending benefits would erode the often-repeated message that the economy is booming. As the data show, for millions of Americans, there is no recovery.