For the past couple of months, the job market has been slowly but steadily increasing. That’s why it’s not entirely surprising that the Bureau of Labor Statistics jobs report shows that it’s still recovering, even if it is at a snail’s pace. However, just as expected is the proof that we still have a long way to go before we return to normal job market levels and many economists believe that this year, as well as 2013, will see an increase in the unemployment rate once again.
As Bloomberg Buisnessweek points out, it is a bit odd to be happy when the unemployment rate is below 9 percent. Of course, this is a big increase from the 11 or 12 percent we were seeing only half a year agp but compared to our year 2000 rate of below 4 percent, it’s a bit ridiculous. For the month of February, the unemployment rate remained at 8.3 percent and 227,000 additional jobs were created and added to the market. Furthermore, the revised numbers for job creation in January increased to 284,000.
If the unemployment rate remaining at 8.3 concerns you, then you should take into consideration the number of people that are returning to the job market after months of being discouraged and giving up. Remember that the unemployment rate does not include the number of people that have given up looking for a job. It only includes those that are unemployed and still actively looking to become employed again. In this case, it’s somewhat OK that the unemployment rate has remained the same because there is probably a good amount of people that have started looking for work again due to lifted spirits and increased optimism as more jobs are available.
However, if you can remember back in the beginning of the month, Federal Reserve Chairman Ben Bernanke gave everyone a dose of reality when he pinpointed and addressed the issues we still have to focus and work on. Much like last month, there are many things that remained stagnant and unimproved. For example, the length of the work week remained the same at 34.5 hours on average. The shorter work week can be attributed to employers cutting their employees’ hours rather than laying them off. In 2009, the work week hit an extreme length low of 33.8 hours.
An increase in the work week’s length would increase the satisfaction of current workers and also allow for companies to be in a position where they can start to hire more employees. These would all be great things for the job market, but they just haven’t started to happen yet. Hopefully, in time, as the job market numbers continue to slowly rise things will continue to improve at a slow but steady rate. In light of the statistics we have seen from the past couple of years, and even months, improvement at any pace is somewhat good news. The important thing is that the reality of the situation is addressed and obvious, and that is that we have much more work to do.
SOURCE: Bloomberg Businessweek
IMAGE: The Politico