Robert Reich is a commonsensical guy, and so what if he sometimes injects false optimism into his commentaries? You can tell he’s merely trying not to be a gloom merchant, that the jobs picture looks as bleak to him as to any other realistic person.
Last week, Reich noted a Bureau of Labor Statistics survey showing unemployment had dropped to 8.6 percent. In his second paragraph he wrote, “We’re not out of the woods but we might be seeing some daylight.”
But from that point on in his column, he listed all the reasons why the government statistics are worth less than zero:
First, this rate of job growth is barely enough to keep up with the growth in the working-age population… Second, retail jobs constituted a third of new private-sector employment in November. Retail jobs tend to be unstable, temporary, and low-paying… Third, the jobless rate fell partly because around 315,000 people who had been looking for jobs dropped out of the job market in November… Fourth, hourly earnings are down, as are real wages. So to some extent Americans have been substituting lower wages for lost jobs…
… Fifth, another reason for November’s job growth is that American consumers – whose spending accounts for about 70 percent of the economy – increased their spending. But this can’t continue because, as noted, wages are dropping. They spent more by cutting into their meager savings. Don’t expect this to last…
There’s more, but the item about increased spending is a killer. It probably means a lot of people are finally replacing those broken appliances, or putting in those new window frames they’ll need to keep their houses warm.
Reich concludes his list of grim counter-statistics by stating “…it’s way too early to break out the champagne.” Right. The BLS reminds me of a lyric in an old Marvin Gaye song: “You tell me lies that should be obvious to me.” Even Reich can’t help wishing the lies were true.