Jobless rate dips to 7%; 200,000 get work

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In the four years since unemployment peaked after the Great Recession, monthly reports from the U.S. Bureau of Labor Statistics have been continuously lackluster as the misery has dragged on.

That is why a pretty good report issued Friday seemed so great.

The nation's unemployment rate dropped in November to 7 percent, down from October's 7.3 percent rate, and employers reported adding 200,000 more jobs, which exceeded economists' expectations.

Wages went up, hours worked rose and more people entered the labor force than left it -- even the job gains were across a broad range of industries.

Wall Street welcomed the news, closing up for the day. The Dow Jones industrial average closed at 16,020.20, up 198.69 points or 1.26 percent. The Standard and Poor's 500 Index closed at 1,805.09, up 20.06 points or 1.12 percent, and the Nasdaq closed at 4,062.52, up 29.36 or 0.73 percent.

Still, the economy has not recovered for most Americans.

"It is important to keep the numbers in perspective," said Dean Baker, an economist for the Center for Economic Policy in Washington, D.C. "Even if it sustained a growth rate of 200,000 jobs a month, it would still take more than six years to make up the ground lost in the downturn."

There are still 10.9 million people who are unemployed. That's down from a peak of 15.3 million in 2009 but -- outside of 10 months of recession in the 1980s -- it still represents more people unemployed than at any time since the government started keeping count in 1948.

A hopeful sign was that the labor force participation rate -- a measure of the percentage of people in the population who are either working or looking for work -- rose to 63 percent in November from October's rate of 62.8 percent, which was the lowest level associated with this recession.

Even with the slight increase, the participation rate is lower than any time since 1978, when women were still entering the workforce.

The number of people who have been unemployed for more than six months and continue looking for work, known as the long-term unemployed, sits at just over 4 million. That's down from the 6.7 million in 2009. Those who are considered long-term unemployed now represent about 37 percent of the total number of jobless workers.

Economists took different views of the latest jobs numbers. Jason Furman, the chairman of the White House Council of Economic Advisers, issued a statement that noted the recovery is continuing to gain traction.

He pointed out that one of the alternative measures of looking at the unemployment level, called by some economists the so-called "real unemployment rate" that includes people who are working part-time for economic issues and those who would like a job but have just given up, fell to 13.2 percent, the lowest it has been in five years.

Still that number is higher than any time before the Great Recession since the government started keeping the statistic in 1994.

The Economic Policy Institute, a Washington, D.C., economic research organization, issued its monthly report Friday on the "missing workers," people who normally would be in the labor force but have sidelined themselves because of poor economic conditions. The report estimates 5.6 million people should be in the workforce but are not. If those people were actively seeking work, the unemployment rate would be 10.3 percent.

The latest U.S. jobs report comes in the midst of a national conversation about a recovery based on low-wage jobs and growing income disparity. Earlier this week, protests were held in 100 cities nationally, including Pittsburgh, over the federal minimum wage.

In a recent study of the job market, the Alliance for a Just Society in Seattle found that between 2009 and 2012, the number of low-wage positions that could not sustain a family increased by 3.6 million while the economy lost 4 million high-wage jobs.

"We must be cautious and not get overly excited about numbers that show a slight uptick from month to month, because it doesn't tell us the full story," said LeeAnn Hall, the executive director of the alliance.

"That only serves to offer us short-term memory of what workers are going through nationally. If you look at what's happening over the longer term, we see a different story."

Ann Belser: abelser@post-gazette.com or 412-263-1699.


First Published December 6, 2013 8:51 AM

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