Here are three things to keep in mind before getting too excited by the February Bureau of Labor Statistics’ predictably cheery jobs report. BLS announced that the economy added 295,000 jobs last month and that the unemployment rate declined to 5.5 percent from 5.7 percent.
|February BLS report shows improvement in low-paying food service jobs.
First, review the Gallup Chief Executive Officer Jim Clifton’s exposé of the inherent deception in how BLS calculates the unemployment rate. Unemployed Americans who haven’t looked for a job in four weeks aren’t counted as unemployed, even though they could not possibly be more unemployed. Clifton, who said that the jobs market for adults is the worst that it’s been in 30 years, called BLS’s fraud “the big lie.” Subsequently, Clifton, joking that he didn’t want to “suddenly disappear,” softened his statement.
The Center for Immigration Studies found that for every job created since President Obama took office (9.3 million), two immigrants, legal and illegal, have come to the United States (18 million). Since, during that period, natural population growth plus immigration has fallen far short of job creation, the number of working Americans in the labor force age 16 to 65 has diminished from 77 percent in 2000 to 72 percent in 2014. Between two-thirds and three-fourths of the 18 million new immigrants arrived legally which means they are work authorized. More immigration – especially the sustained, high levels of immigration the U.S. has experienced for the last five decades – puts downward pressure on wages for those lucky enough to land a job.
Larry Summers, Clinton administration Treasury Secretary and Harvard University President from 2001-2006, indirectly identified one of the core problems in President Obama’s stalled executive action that would give 5 million unlawful immigrants work permits. Speaking to a panel about the future of work in America, Summers said: “There aren’t enough jobs, and if you help some people, you can help them get the jobs, but then someone else won’t get the jobs. And unless you’re doing things that are affecting the demand for jobs, you’re helping people win a race to get a finite number of jobs, and there are only so many of them.”
To be clear, Summers wasn’t talking about Obama’s executive action, but his insights apply. If Obama’s legalization/work permit plan helps illegal immigrants get scarce jobs, American citizens won’t get them.
Other takeaways from the February statistics: the labor force participation rate dropped to 62.8 percent from 62.9 percent, the employment-population ratio held steady from January at 59.3 percent with average hourly earnings up 3 cents to $24.78, paid out over an average 34.6-hour workweek. Low paying food service, construction and health care jobs accounted for much of the job growth.