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Status Quo Economy

- June 7, 2013

In May, The Unemployment Rate Increased From 7.5 Percent To 7.6 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

Since Obama Took Office, The Labor Force Participation Rate Has Declined From 65.7 Percent To 63.4 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

21.8 Million Americans Are Unemployed, Underemployed Or Have Given Up Looking For Work. (Bureau Of Labor Statistics, Accessed 6/7/13)

The Real Unemployment Rate, Including Those That Are Working Part-Time Due To Economic Reasons, Is 13.8 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

Since Obama Took Office, The Average Duration Of Unemployment Has Nearly Doubled From 19.8 Weeks To 36.9 Weeks. (Bureau Of Labor Statistics, Accessed 6/7/13)

Since Obama Took Office, The African American Unemployment Rate Has Increased From 12.7 Percent To 13.5 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

  • In May, The African American Unemployment Rate Increased From 13.2 Percent To 13.5 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

In May, The Hispanic Unemployment Rate Increased From 9 Percent To 9.1 Percent. (Bureau Of Labor Statistics, Accessed 6/7/13)

Since Obama Took Office, The Nation Has Lost 750,000 Construction Jobs.  (Bureau Of Labor Statistics, Accessed 6/7/13)

Since Obama Took Office, The Nation Has Lost 589,000 Manufacturing Jobs.  (Bureau Of Labor Statistics, Accessed 6/7/13)

  • The Month Of May Saw The Slowest Pace Of Manufacturing In Four Years, With The Third Straight Monthly Decline In The Sector. “The pace of manufacturing slowed to nearly a four-year low in May as the global economy sagged and businesses reduced new orders and production.  The gauge measuring factory activity fell to 49 percent last month, a decline from 50.7 in April, the first drop since November and only the second decline since June 2009 when it hit 45.8, the Institute for Supply Management reported on Monday. May is the third straight month the index has declined.” (Vicki Needham, “Manufacturing Drops To Nearly Four-Year Low,” The Hill’s On The Money, 6/3/13)

CNN’s Christine Romans: “This Is Status Quo.” CHRISTINE ROMANS: “Still shows you overall, that you have a labor market that’s having trouble kind of chugging forward. It’s having trouble getting a lot of traction, this is in line with what I was telling you before. The recovery average. It is in line with the average we've seen for the recovery. So I think this is status quo, not as bad as some had feared, it shows a labor market where the firings have slowed down, but the layoffs have slowed. We’ve seen that again and again in the weekly data. We haven't seen robust hiring really kick in.” (CNN’s “Starting Point,” 6/7/13)

CNBC’s Kelly Evans: “It Leaves Us Almost With The Status Quo.” KELLY EVANS: “It leaves us almost with the status quo that we had coming into this report. 2.09 Percent on that 10 year treasury rate that will often set, serve the benchmark for mortgage borrowing costs, which we know have drifted a little bit higher. But it doesn't look like on the back of this report, they're going to be jumping. It doesn't necessarily look like the stock market guys will be jumping either.” (MSNBC’s “Morning Joe,” 6/7/13)

The Washington Post’s Ezra Klein: “I Would Call This A Very Status Quo Jobs Report.” EZRA KLEIN:  Everything, all the movement here I would say is small. I would call this a very status quo jobs report. You're looking at a number of new jobs added. very much in line with the last four months. You're looking at an essentially unchanged unemployment rate. You’re looking at very small changes in wages. I think I agree ultimately what Steve says here, this is not enough to really get the unemployment rate down.” (MSNBC’s “Morning Joe,” 6/7/13)

The Status Quo Economy Is Not Enough To Reinvigorate The Nation’s Weakened Labor Force And Declining Middle Class

“Nearly Two-Thirds Of Jobs Lost During The Recession Paid Middle-Class Wages, According To The National Employment Law Project. Yet Only 22 Percent Of Jobs Created Under Obama Are Mid-Wage Occupations.” “Nearly two-thirds of jobs lost during the recession paid middle-class wages, according to the National Employment Law Project. Yet only 22 percent of jobs created under Obama are mid-wage occupations. That disparity is what Obama had in mind when he declared in his Inaugural Address, ‘We know that America thrives when every person can find independence and pride in their work, when the wages of honest labor liberate families from the brink of hardship.’” (Ron Fournier, “Middle Class Falls, Wall Street Rises…And Washington Dithers,” National Journal, 5/31/13)

“The Country's Tepid Growth In Its Gross Domestic Product Isn't Creating Enough Good Jobs To Build A Strong Middle Class.” “The country's tepid growth in its gross domestic product isn't creating enough good jobs to build a strong middle class, according to a UCLA report released Wednesday. ‘Growth in GDP has been positive, but not exceptional,’ UCLA economists wrote in their quarterly Anderson Forecast. ‘Jobs are growing, but not rapidly enough to create good jobs for all.’ The report, which analyzed long-term trends of past recoveries, found that the long-anticipated ‘Great Recovery’ has not yet materialized.” (Ricardo Lopez, “UCLAS Anderson Forecast Paints Dismal Picture Of Economic Recovery,” Los Angeles Times, 6/5/13)

“When The Autopsy Is Written On The Death Of The Middle Class, The Current Lousy Economic Recovery Will Be A Major Contributing Factor.” “When the autopsy is written on the death of the middle class, the current lousy economic recovery will be a major contributing factor, according to a new report. The job market's recovery from the Great Recession has been the slowest since World War II, and middle-income jobs lost during the recession are being replaced by low-wage McJobs.” (Mark Gongloff, “The Death Of The Middle Class Is Being Sped Up By The Anemic Recovery: Study,” The Huffington Post, 6/5/13)

A Recent Study By The Boston Federal Reserve Concluded That The Decline In Labor Force Participation Is Mostly Due To Prime-Age Workers Dropping Out Of The Work Force, Rather Than Elderly Retirement.  “These regression results provide stark evidence that cyclical factors have been crucial in explaining the recent decline in prime-age LFPR. The coefficient on the lagged change in prime-age unemployment is highly significant (t-statistic of -3.9); that is, the state-level data exhibit a strong negative correlation between changes in LFPR and lagged changes in unemployment for prime-age adults. In contrast, the regression intercept is not statistically significant from zero (t-statistic of -0.97), indicating that the data provides no support whatsoever for structural interpretations of the drop in prime-age LFPR. In effect, the state-level data indicates that the aggregate decline in prime-age LFPR since 2007 can be fully explained by the persistent shortfall in labor demand…” (Christopher J. Erceg and Andrew T. Levin, “Labor Force Participation And Monetary Policy In The Wake Of The Great Recession,” Boston Federal Reserve, 4/9/13)

“What Is New, Surprising, Alarming And Often Overlooked In The Labor Force Today Is The Exodus Of Workers In Their Prime — And All The Growth Opportunities They’ve Taken With Them.” “This is exactly why it was wrong in the first place to point to demographic change as the more important component of the decline in labor force participation today. It has never been a question that America’s demographics would shift as the baby boomers began to retire; we’ve seen it coming for decades. What is new, surprising, alarming and often overlooked in the labor force today is the exodus of workers in their prime — and all the growth opportunities they’ve taken with them.” (Jim Tankersley, “WonkFeud Part 2: The Labor Force Participation Debate Gets Real,” The Washington Post’s WonkBlog, 4/30/13)

“This Recovery Is Still Half The Pace Of The Normal Expansion.” “The bad news is that this recovery is still half the pace of the normal expansion. The Joint Economic Committee reports that if the economy had grown at the typical pace coming out of recession, at this stage GDP would be closer to $17.4 trillion. This $1.4 trillion growth deficit is roughly the size of the combined annual production of Michigan, Ohio and Pennsylvania in 2011.” (Editorial, “The Growth Deficit,” The Wall Street Journal, 4/28/13)


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