Stimulus Spending And Job Growth: Update 16
Well, it's that time again (actually past that time). Time to update Obama's stimulus-driven job creation results. For the month of September, there was a net loss of 95,000 jobs, which included the layoff of another 77,000 temporary census workers. That's surprising, because I had gotten the impression that the census was complete in August, and that all temporary employees were laid off last month. Obviously my last article on this subject (Update #15) was incorrect in this regard.
As you may remember, back in May (Update #12), I discounted the hiring of 411,000 temporary census workers because of the temporary nature of those jobs. Therefore, I was compelled to discount the layoffs of those workers in the following months. Going back and checking my records, I discounted 225,000 layoffs in June, 143,000 in July, and 114,000 in August, for a total of 482,000 layoffs (or 71,000 more than the original 411,000 hires). This month there were an additional 77,000 layoffs.
That can only mean one thing: that additional census workers were hired during the months of June through August, but which I did not account for and likewise did not discount. Therefore, I have decided that since I only discounted the original hiring of 411,000 census workers, I will only discount the layoffs of those same 411,000 workers. Therefore, I have gone back and added 71,000 job losses to the 60,000 jobs gained in August, for a net loss of 11,000 jobs.
I have also adjusted the July and August job figures downwards according to the latest data from the US Dept of Labor. There were 12,000 more job losses in July than originally reported, bringing the net job gain from 89,000 down to 77,000. In August there were an additional 3,000 jobs lost raising the total from 11,000 jobs lost (see above) to 14,000.
Barack Obama said his stimulus package would create approximately 4 million "new" jobs over two years. In order to create 4 million jobs in 24 months, the Obama administration would have had to create approximately 166,667 jobs per month to reach his target, assuming linear job growth. That scenario is shown as violet in the following graph.
I developed a curve showing what I thought might be a more "Likely" scenario -- plotted as light blue in the following graph. As you can see from the graph, the actual trend was somewhat worse than I had predicted -- plotted as yellow and red. However, the trend generally followed the trajectory I had originally envisioned until about May of this year (Month 15). Obama's "Summer of Recovery" was virtually non-existent. Since May, job growth has been essentially flat, and now appears to be headed on a downward trajectory.
Instead of having to create 166,667 new jobs per month to reach his original target of 4 million new jobs, President Obama now needs to create 1,223,600 jobs per month -- in order to make up for the 2 million jobs that were lost since the stimulus bill was signed.
According to US DOL statistics, the official unemployment rate continues to be 9.6%, because there are 14.8 million unemployed people in the United States who are actively seeking work. But there are another 2.5 million people who are only "marginally" attached to the work force because they did not seek work in the last month, and another 9.5 million people who are working part-time only because they can't find a full-time job.
I am sorry to once again report that I continue to remain unemployed. This coming Monday, October 18th will mark 13 months without a job. However, I am happy to report that I have seen more activity in the last 6 weeks than I have in the preceeding 11-1/2 months. I have had phone interviews, face-to-face interviews, or calls from headhunters for positions with a number of well-known companies including Coca-Cola, Wrigley's, Johnson & Johnson, AT&T and Alcoa, as well as some other not so well-known companies. I continue to covet your prayers.