Phantom Jobs and Economic Recovery in America - by Stephen Lendman
On May 6, headlines cheered the new jobs report, New York Times writer Motoko Rich headlining, "Payrolls Show Strong Growth but Jobless Rate Rises," saying:
"For three straight months, the nation's employers have delivered solid job growth, easing some concerns that the economy could be slowing."
Bloomberg.com's Timothy Homan said:
At 244,000, "American employers in April added more jobs than forecast....indicating the world's largest economy is weathering the impact of higher fuel prices."
Wall Street Journal writer Sara Murray wrote:
"Job engine shifts to higher gear (as) companies cranked up hiring in April to the fastest pace in five years...."
In fact, labor force participation held steady at 64.2% for the fourth consecutive month, down from 66% in 2006. Moreover, economist Jack Rasmus estimates 25 million unemployed, a number showing downturn, not growth. He also explained that considerably more workers left the labor force than entered it, saying:
A recovering jobs market "does not experience that kind of massive number of discouraged workers leaving the labor force. Quite the opposite. A truly recovering labor market is characterized by large numbers of discouraged workers re-entering the labor force. Something else is going on here."
In addition, about one-third of new hires are temporary or part-time, jobs paying two-thirds or less than normal pay with few or no benefits. Moreover, another one-fourth are temp agency hires, meaning around one-half of all jobs created are "low pay, no benefit" ones, showing a sick, not healthy economy.
At the same time, initial jobless claims hit an eight-month high, rising to 474,000 for the week ending April 30, the third increase in the last four weeks and a clear sign of job losses, not gains, so what to make of the Labor Department's report. More on phantom jobs creation below.
Other reports also look dire. New Department of Agriculture data show 14.3% of Americans receiving food stamps, a record 44.2 million and rising. Moreover, US Census figures show over 47 million Americans in poverty, more than one in seven but way underestimated.
Even the Census Bureau admits that official thresholds were developed over 40 years ago. As a result, they omit:
-- true rising inflation levels, notably food and energy currently;
-- other expenses like child care, transportation, high tuition and medical expenses; and
-- stagnant or falling incomes in recent years, as well as eroding benefits.