The Wall Street Journal’s weekend addition carried the following headline (above the fold): “Hiring Slowed At Close Of Record Jobs Year” followed by the sub-headline “New positions grew by 199,000 in December and the unemployment rate fell to 3.9%.” I read the Wall Street Journal because among all of the mainstream media it stands alone in a dedication to follow the facts rather to recite a predetermined political narrative. I was disappointed in the coverage because it left both the “markers” and the most critical element of an employment trends off the table.
First, the only reason that it was “record jobs year” is that it was the recovery of a virtual crash in the jobs market caused by the government hysteria over the COVID-19 pandemic. In point of fact, the recovery is just about as anemic as the jobs recovery under former President Barack Obama following the Bush/Obama recession of 2008-09. According to the Bureau of Labor Statistics, prior to the recession, employment peaked in January of 2008 at approximately 138,403,000. There were approximately 13,000,000 jobs lost. It took until May of 2015 – seven long years – for that number to recover to 138,511,000 jobs. And even at that it was not a full recovery because the number of people eligible to enter the workforce increases at about 200,000 per month – 2.4 million per year.
The job loss caused by the pandemic began in about February of 2020 when the employment peaked at 152,523,000. Two months later – May of 2021 – the employment figure had dropped to 130,161,000 – a loss of 22,363,000 jobs. Through December of 2021, the “recovery” has resulted in an employment figure of 148,951,000 – meaning that there are nearly 3.6 million jobs still lost as of today and again that does not account for the regular 200,000 additional people becoming eligible to enter the workforce each month. Remember that the job loss attendant to the pandemic was not the result of an economic downturn but rather a government created panic which in turn caused the downturn. The slowness of the recovery is largely due to Mr. Biden’s insistence on paying people to defer to welfare rather than return to work – and we are still locked in that phenomena. The fact that there are nearly 1,000,000 job openings that are going unfilled is due in large part to Mr. Biden’s preference for welfare over employment. If you are a champion of enlarging the welfare state then Mr. Biden should be your personal hero.
But the real key to understanding the state of welfare over employment is found in the Civilian Labor Force Participation Rate (CLFPR). It is the percentage of working age people that are actually employed or actively seeking employment. The calculations do not include persons in the military, retired, institutionalized, or unavailable to work (including homemakers). The CLFPR stood at 66.2 in January of 2008 immediately preceding the Bush/Obama recession – that means that approximately one-third of those eligible to work chose welfare over work, a dismal figure. However, Mr. Obama’s preference for welfare over work drove that number steadily down during his eight years in office to 62.7 – approximately three-eighths of those eligible to work choosing welfare. Mr. Obama’s successor, President Donald Trump was able to reverse that trend and brought the number back up 63.4 January of 2020 – just prior to the advent of the pandemic. The number under Mr. Biden now rests at about 61.9.
It is the CLFPR that defines the health of America’s labor market – not the unemployment number, not the total employment number, not even the delta for the total employment numbers. It is pure and simple the number of people either employed or actively seeking employment vs. the total number of people eligible to work. It is an embarrassing number more illustrative of a welfare economy than a growth economy. It is reflective of people running government who are virtually ignorant of the requirements to build and sustain an economy or even a job. It is reflective of fifty years of ignorance, incompetence and failure – it is Mr. Biden personified.