The following editorial appeared in the Philadelphia Daily News on Tuesday, Oct. 9:

Last week’s news that unemployment dropped to 7.8 percent prompted a form of schizophrenia among some conservatives who asserted that the numbers weren’t that good, and also that they had been fabricated to help President Obama.

Former GE chairman Jack Welch claimed Obama’s team had somehow cooked the books. His proof? Welch said he talks with a lot of business leaders, and they tell him they aren’t hiring.

Turns out there’s a reason for that. There are two surveys that contribute to a jobs report like Friday’s. One includes businesses, the kind of people Welch talks with. It showed meager growth, 114,000 sector jobs, in line with an economy that’s slogging along.

The other is a survey of households, the kind of people Welch does not talk with, unless they are 20-bedroom households. The good news: This one showed more people looking for work, a good sign, and more people finding work. The bad news: It was mostly part-time work.

Conservatives are right to question the strength of the recovery in the private sector. The jobs generated are barely enough to keep the tepid recovery above water. Jobs are concentrated in low-wage areas like retail and hospitality, or the bottom rungs of health care.

This is part of a bigger, knottier picture: Many economists no longer believe our slow growth and sticky unemployment problem are part of a business cycle. They believe we have major structural problems in our economy — obstacles that will make it tougher to add jobs down the road, and that will keep the number of unemployed and underemployed at 23 million, unacceptably high.

Take start-ups, traditionally the real engine of job growth. Today’s start-ups do not want or need as many new employees. In today’s highly technological and cloud-based world, entrepreneurs can keep overhead extremely low. There’s no brick, no mortar, and often no benefits for the people who do get hired. More employees tend to be independent contractors, and part time. The average number of workers per new business started dropping in 2001, and during that time total start-up employment has dropped from 4.5 million per year to 2.5 million.

Our problems are new and vexing, and our presidential candidates have offered little creative thinking here. In last week’s debates, both candidates had 15 minutes to talk about jobs, and we heard no new ideas — moderator Jim Lehrer wasn’t the only one asleep. Old ideas — about tax cuts, training, trade deals — don’t match up with our new problems.

Speaking of new problems, there was a strange and inexplicable number in Friday’s report. For the first time in recent history, September employment showed a rise for those age 20-24. Traditionally employment in this group declines as students head back to college. No one has explained this number, but one economist offered some theories — these folks are not going back to college because they can’t afford to, or are working their way through school to sidestep the kind of debt that has crushed their peers and their parents.

This could be the most hopeful sign in the jobs report — that people aren’t waiting for Washington to set sensible policy. They are setting their own.

(5) comments

MichaelS
MichaelS

the unemployment numbers will be "up graded" next month (after the election) as they forgot to calculate California into there numbers just another slight "over sight".

FlamingLiberal1
FlamingLiberal1

Seriously? You don't like the numbers so you accuse them of being a lie? If there truly was a conspiracy to cook the books, don't you think we would have had better numbers all along? And look at the four-year trends. These numbers are accurate!

dietz1963
dietz1963

I'd say more suspicious rather then a conspiracy. Numbers up until recently (according to the media anyway) have held pretty much around 8.1% then all of a sudden its 7.8%? Who knows. If you go by U.S. Dept of Labor Statistics, all presidents have had issue with unemployment. Reagan got it at 6% (it was already climbing) Went all the way up to 10.8% by his second year in office but had dropped down to 5.3% when he left. 1st Bush time it raised from this to 7.2% before he left. Clinton got this and it rose slightly to 7.6% but then dropped down to 4.1%. First year the 2nd Bush was in office, went down to 3.8%, climbed up to 6.3% in 2003, back down to 4.4% by 2007 then began an upswing to 7.3% when he left office. So Obama got it with 7.3%, it climbed up to 10% within his first year then held steady around 9% for a year and held around 8% until now. Historically by these numbers you could say Reagan got the problem from Carter and Obama got the problem from Bush. Only difference I could see is, for whatever reason, it was almost 2 years before unemployment hit the 10% range in Reagans case where is was less then a year in Obamas case. Things that make you go hmmm...

jgrdh11
jgrdh11

The problem with this number is that it doesn't take into account those that are able to work, but simply quit looking for work. When those people are included in the equation the unemployment figure is still double digit. Unfortunately, the reason many of these people are no longer looking for work is because they have chosen to live off the system instead of trying to support themselves. Better triggers need to be put in place to ensure people able to work are no longer allowed to collect their Obama dollars, as they call them.

FlamingLiberal1
FlamingLiberal1

The unemployment numbers have ALWAYS been calculated this way, and what would be unfair would be to suddenly change the formula for calculating figures and then compare them to numbers calculated using the old method. There is nothing suspect whatsoever. At the time Obama took office, we were losing 800,000 jobs per month. We have had several years of consistent job growth, even if it isn't fast enough to suit you. Romney promises jobs but doesn't say how he's going to produce them. Maybe with the unfunded budget increases of 8 trillion dollars?

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