By FRANK STRICKER
The latest U.S. Bureau of Labor Statistics jobs report, published Aug. 6, was on the whole positive. But Blacks and people with disabilities continue to be hit by persistently high unemployment, and true unemployment remains higher than the official government statistics indicate.
In July, 943,000 nonfarm jobs were added, and the June additions were revised upward to 938,000. The information from the household survey was positive too. The unemployment rate fell by half of a percent to 5.4%. For whites, the rate dropped to 4.8%. That’s close to conventional definitions of full employment as 4% unemployment. But the rates were still very high for Black people (8.2%) and disabled workers (12.1%).
Also, as the National Jobs for All Network’s Full Count shows, actual unemployment is much higher than official estimates. While the official unemployment rate was 5.4%, NJFAN’s estimate is 11.7%. This higher number includes 6.5 million people who said they wanted a job but had not recently searched. In fact, there are always millions of people just outside the labor force on the alert for good job opportunities. Some are waiting for changes in personal (such as child-care obligations) or societal (such as COVID infection surges).
Generally, labor markets are tightening, but not as much as some commentators think. On Aug. 9, we learned from the survey of job openings and separations that there seemed to be more job openings than unemployed people in June. But if we include the hidden unemployed, there are twice as many unemployed and looking for jobs as there are openings.
The Two Plagues
The jobs report is based on information collected early last month, so it does not reflect the latest COVID spikes. Currently, we have a Double Plague: The Delta variant and the intellectual-political sickness, which leads average folk and Republican governors to believe that it is good politics and patriotic not to get vaccinated or wear masks. Both plagues especially endanger employees whose work requires a lot of interaction with the public.
The threat of getting sick and the real possibility of new business closures looms over many sectors, including the leisure and hospitality group, including bars and restaurants. People are coming back to work, and some employers are raising pay to attract employees. But job growth and pay increases could be stymied if the Delta plague continues.
Meanwhile, federal pandemic aid programs are being phased out. The $1,200 stimulus checks are gone. The $300 unemployment supplement and special programs for gig workers will end everywhere on Sept. 6, Labor Day. Conservative states began weeks ago to cut the $300 supplement and special benefits for gig workers.
So, there may be less federal money out there as the Delta variant spreads. But what about that infrastructure bill that looks to become law soon? It’s a good idea to fix bridges, roads, and water systems and to employ more people that way. But the annual employment effects of spending $550 billion over five to ten years is not so large. And as for deficit-spending stimulus, the Congressional Budget Office predicts that the infrastructure bill will add $256 billion in deficits over ten years. That’s just $25.6 billion a year–not much of a kick in a 20 trillion-dollar economy.
On the horizon is a Democratic plan to spend $3.5 trillion on health care, child care, education, and climate change. Its prospects are uncertain. Republicans and conservative Democrats who voted for the infrastructure bill care more about fixing bridges than fixing child care.
A Note on Poverty
Typically, during depressions and recessions, poverty rates rise as people lose jobs and income. However, experts claim that the share of the population under the poverty lines in 2021 is falling faster than in the last 60 years. Why? Mainly because the federal government sent out a lot of money. In particular, the stimulus checks, food stamps, and unemployment benefits kept people from falling into poverty and lifted others above poverty lines. Federal benefits had an especially positive effect on Black people and children.
It is a cause for joy when millions of poor people get a boost. And–no surprise–you can reduce poverty rates by giving people more money. There are caveats to this upbeat story: Federal poverty lines are very low, and millions of people above the lines are actually poor. Also, in a good-jobs full-employment economy, some of these people could be genuinely non-poor by earning adequate pay and benefits as jobholders. Finally, many pandemic benefit programs are gone or on the way out. That suggests that poverty rates will jump up again. Still, over the short term, President Biden’s de facto war on poverty was remarkable.
To view NJFAN’s Full Count of unemployment, go to https://njfac.org/index.php/
Frank Stricker is on the National Jobs for All Network board and is an emeritus history professor, California State University, Dominguez Hills. His new book is American Unemployment: Past, Present, and Future (2020).