Last Friday, the government issued the employment report for December. To the surprise of economists, who had expected payrolls to swell by approximately 200,000 jobs, only 74,000 jobs were added to the economy. That’s only 37% of what was forecast by the experts.
The unemployment rate dropped from 7 percent in November to 6.7 percent in December but that actually didn’t turn out to be good news either. The drop was largely because of people leaving the workforce.
The civilian labor force dropped from 155.3 million Americans to 154.9 million, which means the labor participation rate dropped to a new 35 year low. Only 62.8% of Americans are working, down from 63%.
What’s happening? Some blamed bad weather in December for limiting job growth and others think the number is an aberration. But some others have pointed out that the average job growth per month in 2013 (182,000) looks very similar to 2012 (183,000) and 2011 (175,000).
The average American isn’t feeling an economic rebound. There is still a lot of economic pain, suffering and fear occurring. Meanwhile, the politicians are still engaged in partisan political games and not addressing the economy’s short-term or long-term needs.
What needs to be done? The hard stuff: 1) Fix our education system so geography doesn’t determine a child’s prospects for receiving a good education; 2) Put our country on a fiscally sustainable course; 3) Reform our tax system so that it favors the creation of jobs, especially US manufacturing jobs; 4) Reform our immigration system; 5) Replace many job-destroying regulations with market-based solutions that accomplish the same thing in a job-friendly manner.
If the politicians in Sacramento and DC continue to care more about keeping their own jobs versus creating jobs for middle class Americans, perhaps it’s time for a change. We need leaders who are willing to tackle the hard stuff. I hope you agree.