Today’s job report, stronger than expected, shows public sector job growth continues. So why is unemployment up? Congress and its self fulfilling prophecy.

While private sector job growth continues with 172,000 new jobs, the best in five months, some political groups howl how the economy is horible. While far from out of trouble we are certainly heading in the right direction and for a sustained period. The howling comes from those who want to blame the other party, and have played their obstructionist games in congress. While private sector jobs grow accounting for all the job gains, some in DC keep cutting government jobs and in doing so create further instability in the workforce. This month government payrolls dropped by 9,000, as local governments laid off teachers and others.

Let’s look at where we would be if the public sector had retained jobs at the previous (Bush) administration levels.

The lesson appears to be that the obstructionists in Washington are making their own truth in cutting jobs at our expense. In less kind words, they are making unemployment bad so they can say unemployment is bad. Yes the unemployment would be significantly lower if our government had retained the same numbers of workers it had when our current president, Obama took office.

Here are some of the real numbers in thousands of persons:

(Source: St. Louis Fed, author calculations)

 

What all this means is that the sound bites we’re being fed by special interest groups telling us how much the government has grown during this administration don’t stand up to the facts. There has NOT been a massive expansion of government, in terms of either spending or hiring. “Sadly for fiscal conservatives, the biggest surge in government spending came during the last two years of President George W. Bush’s eight years in office (2007-2008).” Arthur Laffer, Stephen Moore op-ed in the WSJ Obama’s Real Spending Record]

5 thoughts on “Obstructionists Create Unemployment, say Unemployment is bad

  1. Ken Simpson

    The gain of 162,000 jobs is the result of the office survey. According to the household survey 192,000 job were lost. The unemployment over all level rose from 8.2 to 8.3.
    With over 130,000 new people entering the work force every month due to population growth the economy must create 130,000 new jobs each month to break even so to speak. As it stand now over two million people have stopped looking for work in the last year and are not counted in either survey. It is all about which numbers you want to include in your commentary.

    Posted by Ken

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  2. Kauf2030 Post author

    Ken, You are absolutely correct in that with work force growth it takes a lot of job creation just to break even. My attempt to point out the differences in the public sector growth/shrinkage fell short. I have since followed up on 8 Aug hoping to make the point a bit better. Clearly a lot more jobs are needed and within the comparisons we continually hear during this election year, a bit of truth is being lost in no few talking about the large public sector reductions.

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