STILL 1.4 Million Fewer Full-Time Jobs than in 2008

By Lee Adler, The Wall Street Examiner:

Let’s cut to the chase: There were 1,446,000 fewer people working full time in August 2014 than in August 2008, according to the Bureau of Labor Statistics household survey (CPS).

Total and Full Time Employment- Click to enlarge

That’s after an increase of 210,000 full-time jobs in August. That’s the actual count, not the seasonally adjusted abstraction. So we have to compare that with past Augusts to get an idea if its any good or not. August is a swing month, sometimes up, sometimes down. The average change over the prior 10 years, which included a couple of ugly years in the recession, was -63,000. So this number wasn’t bad. It was slightly better than August of last year and 2012, but come on….

It’s still 1.4 million below 2008? In 2008, the economy was in full collapse mode. The Fed has expanded its balance sheet by $3.7 trillion since August 2008 and there are fewer full-time jobs now than then? Remind me again what that $3.7 trillion has bought!

The Fed, Full TIme Jobs, and Stock Prices- Click to enlarge

Since August 2009, near the bottom of the recession, the US economy has added 6.25 million full-time jobs, a 5.5% increase. That amounts to $588,000 in Fed QE per added full time job. But that’s ok. It’s been great for bankers, securities brokers, and hedge funds. While the number of full time jobs increased 5.5%, stock prices soared 175%. It’s all good!

Or not. I have argued for a long time that the Fed’s policies have rewarded financial engineering at the expense of job creation. The Fed has made it profitable for corporations to borrow free money to buy back the stock options that they issue to their executives rather than investing in expanding their businesses and creating jobs. The Fed’s policies have enabled corporate executives and their financial enablers to conduct a massive skimming of the US economy and wealth transfer at the expense of everybody else. By promoting this behavior, not only has Fed policy been ineffective in stimulating real growth, it has been a moral outrage, decimating the middle class and robbing the elderly of their life savings as they’re forced to consume principal.

The result has been that growth in full time jobs barely keeps pace with population growth. The ratio of full-time jobs to total population was 48.4% last month. That’s finally above the August 2009 reading of 48.2%. August 2009 was the bottom of the recession. At the bottom of the 2003 recession, before the housing bubble took off, this ratio was at 52%. In terms of a recovery in the number of jobs that might support a family, the Fed hasn’t supported recovery, it has suppressed it. By Lee Adler, The Wall Street Examiner.

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  3 comments for “STILL 1.4 Million Fewer Full-Time Jobs than in 2008

  1. Larry
    Sep 8, 2014 at 5:46 pm

    But consumer spending is still really high. So its hard to notice the lack of good jobs being created. Plus with subprime auto lending masking the low job counts. Plus rich people buying houses and just within last year perhaps bad housing data coming out.

    I think once consumer spending or the subprime or housing goes bad, that job situation will be better clarified, but its too easy to mask the problem of low wages, since the normal parts of the economy still “work”.

    • Petunia
      Sep 9, 2014 at 3:30 pm

      I don’t see consumer spending being high in Florida. Several stores have closed in my local mall, some were big chain stores, and have not been replaced. I am noticing fast food places being built around town. As for me, if I don’t need it I don’t buy it.

      • Larry
        Sep 9, 2014 at 5:23 pm

        I meant on the national level.

        Florida was hit hard by the housing bubble collapse, so I imagine some parts of it are still doing badly compared to other parts of the US.

        Of course in the housing bubble, when enough subprime mortgages started to default the system went under. So if enough places look the same way your spot in Florida looks. Will probably affect the whole US.

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