At today's monthly employment briefing with Assistant Treasury Secretary for Economic Policy Alan Krueger, the message was clear: focus on the bigger picture rather than monthly hiccups; to that end, here is their graph, drawn from BLS data. Nonetheless, it's important to remember how surprising this job loss was to forecasters, who all expected small gains after last months rosy numbers. Krueger noted that temporary hiring is still increasing, generally a good early sign, and that initial unemployment claims have been dropping consistent with past recoveries. But he also emphasized the importance of doing yet more on the policy front, emphasizing that the White House is working with the senate to try and pass a version of the jobs bill that already cleared the House. He also previewed this afternoon's presidential announcement of $2.3 billion in tax credits to clean energy manufacturers (not additional money but rather newly targeted stimulus money). Meanwhile, EPI's Larry Mishel e-mails this observation:The real news in these data is the 1.9 million erosion of the labor force, those seeking work or working, since May, with a 661,000 decline last month alone. Absent this flight from the labor market the unemployment rate would have risen substantially in December, up 0.4%, rather than hold steady. The share of adults working fell 0.4 and 0.3 percentage points, respectively, among men and women. Clearly, the continued erosion of jobs, though modest compared to earlier in the year, and workers abandoning the labor market in droves, indicates we still have severe and growing employment problems facing Americans.Oh, and since some folks (well, conservatives and Chuck Lane) have been complaining about the minimum wage's supposed negative affect on employment, I asked Krueger, who wrote the book on the subject as an academic, what he thought of that proposition. "There is no evidence to suggest the minimum wage has been a factor in this recession," Krueger said.
-- Tim Fernholz
