50-0 FILES:

Flexibility, Quality, and Numbers: The Job Market Is More Than on Track (Tim Kane, Ph.D., July 2, 2004, Heritage)

June’s preliminary payroll number of 112,000 came in at about half the expected gain of consensus projections. This is likely to be seized by naysayers as proof that the expansion remains anemic. Nothing could be further from the truth. For a variety of reasons, the better survey of labor market conditions is the household survey, and it reports another record level of employment this month—for the first time ever, more than 139 million Americans are working. Since December 2000—when total U.S. employment was 137.6 million according to the household survey data—the economy has created 1.4 million net jobs.

The labor force continues to expand. June saw another large influx of new workers, 305,000 of them, into the labor market, reflecting increased confidence in the economy. Over the past two years, nearly 2.5 million individuals have entered the labor force.

Despite this great expansion, the unemployment rate remains impressively low at 5.6 percent. Unemployment as a percent of the growing labor force has been steady at 5.6 percent for all but one month of 2004. By way of comparison, the average unemployment rate of the 1990s was 5.8 percent. That the economy continues to accept so many new workers with such ease is remarkable.

The economy added 112,000 payroll jobs in June, marking the tenth straight month of payroll employment growth. Over the past year, the economy has added nearly 1.5 million payroll jobs.

Anyone who doesn't have a job doesn't want to work.

Posted by Orrin Judd at July 9, 2004 3:01 PM