Economic Perspective: The Slow Job Numbers

MARY WALDEN:

“Today’s program looks at the slow jobs numbers. Mike, the recently released job report for February was disappointing. Only 20,000-net, new payroll jobs were added, although the unemployment rate did drop. Is this a sign of faltering economy and possible oncoming recession?”

MIKE WALDEN:

“And of course this is at the national level, and to put the 20,000 in perspective we had a couple of previous months where we were adding 300,000. So yes, this was a big disappointment. I don’t think we need to panic though because number one: winter months are always very difficult with these numbers.”

“And in fact we had some snow storms in the north that was going to impact the job numbers because if the people aren’t there when the surveyors report to record the numbers they’re not going to pick up all the jobs.”

“Interestingly, we actually had in a separate survey, which is done of households, several hundreds of thousands of people actually reported being employed more than they were in January. I think that though was largely reflective though of the end of the government shutdown.”

“So again I don’t think this is a panic situation. We do think that we’re going to have a slower economy in 2019. Now there were some good numbers out of the job report. For example, wage rates continue to rise. That’s good. Wage rates are going up about a full percentage point than inflation. And the percentage of working-age people with a job, that also continues to go up.”

“So this is a month-to-month situation. I do continue to think that the job market will improve.I do think wages will continue to go up. I just don’t think we’re going to get the numbers of new jobs in 2019 than we did in 2018.”

Mike Walden is a William Neal Reynolds Distinguished Professor and Extension Economist in the Department of Agricultural and Resource Economics at North Carolina State University who teaches and writes on personal finance, economic outlook and public policy.