05.31.2010 0

Too Hot Not to Note: Expect false jobs spike

  • On: 06/03/2010 00:23:17
  • In: Economy
  • ALG Editor’s Note: In the following featured story from The Hill, Ian Swanson takes note of the fact that constitutionally-mandated Census jobs does not necessarily equal economic growth:

    Expect false jobs spike

    By Ian Swanson

    Hiring by the U.S. Census Bureau is expected to dramatically spike May’s job figures.

    Economist Mark Zandi of Moody’s.com projects the economy will add 575,000 jobs in May, while the Economic Policy Institute’s (EPI) rough projection is for 560,000 jobs.

    Either figure would represent the largest number of jobs created in any month since the dot-com crash of 2000.

    Vice President Joe Biden, speaking at a Democratic fundraiser on Tuesday, touted what he said would be a positive report for Democrats, who are hoping a revitalized economy will help them in this fall’s elections. He said the May report would be “well beyond” the 290,000 jobs created in April, according to Reuters.

    The numbers pose a problem for the administration, however, in terms of their reflection of economic growth.

    Zandi expects that only 150,000 of the jobs created in May will come from the private sector, while 425,000 new jobs are sparked by the once-a-decade census.

    Those jobs are temporary ones that will disappear as the Census completes the process of collecting data from people who did not mail in their forms.

    In fact, hiring for the Census probably peaked in the first week of May, when 585,729 temporary workers were on the Census payroll, according to the agency’s figures.

    The number of temporary workers had dropped to 572,779 the second week of May, and it is expected to drop further in coming weeks.

    “I do think that we have peaked,” said Shelly Lowe, a public affairs official with the Census. “I do not expect it to go back up.”

    A new report from the Census on its temporary hires will be released on Wednesday.

    The Census isn’t done hiring.

    It will take on about 200,000 employees to conduct the “vacant-delete check” in July and August. That involves double-checking properties marked down as vacant to make sure the census hasn’t missed people.

    Another 20,000 workers will be needed for work through October, checking up on earlier census work.

    But that hiring won’t make up for the layoffs of temporary workers now employed by the Census. The bottom line is that Census hiring will wind down in the coming months, putting upward pressure on the unemployment rate, which stood at 9.9 percent in April.

    The administration has been bolstered by positive jobs numbers so far this year. The economy created more than 200,000 jobs in March and April, and a surprisingly large number of the jobs represented hiring by the private sector.

    President Barack Obama’s approval ratings have remained relatively high despite the economic troubles.

    In the summer of 1982, then-President Ronald Reagan’s approval rating dropped below 40 percent as unemployment skyrocketed above 10 percent. Republicans ended up losing seats that fall in the House and Senate, though Reagan turned it around by 1984 as the economy improved.

    Those numbers offer some hope for Obama, who is dealing with the largest rise in unemployment since the Reagan era and has seen his poll numbers, so far, hold up better than the Gipper’s.

    Zandi expects private-sector job growth to remain around 150,000 through the fall, which he expects would eventually put the unemployment rate above 10 percent again.

    Overall, he expects strong job growth.

    In an e-mail, he projected “what should be very strong labor force growth as workers step back into the job market given the increasing number of job opportunities.”

    That points to one last problem for Democrats: the number of people returning to the workforce after giving up hope of finding a job.

    EPI’s Heidi Shierholz expects the participation rate in the workforce to continue to grow, outpacing population growth.

    The economy needs to add roughly 100,000 jobs every month in order to create enough jobs to accommodate population growth.

    During the recession, millions of people dropped out of the workforce and quit looking for jobs.

    As they return, the economy will need to create even more jobs to accommodate all of the people looking for work.

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