August job creation down from previous months
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Last Friday, the U.S. Bureau of Labor Statistics reported that the economy gained 96,000 jobs in August, a number down from the previous average job gains of 139,000 per month in the earlier months of 2012.
A majority of these 96,000 jobs were added in food service, professional and technical services and health care. In August alone, 28,000 jobs were added to the food service industry, and over the past year, 298,000 jobs have been added in that industry, according to the report.
Along with the creation of these 96,000 jobs, the bureau reported that the unemployment rate dropped from 8.3 percent in July to 8.1 percent in August. But that doesn’t necessarily mean employment improved overall, said Farrokh Nourzad, a Marquette professor of economics.
“By itself, last month’s decline in the official unemployment rate … is not indicative of an improvement in the employment situation, as there were more people dropping out of the labor force than there are new jobs created,” Nourzad said.
Some of those drop-outs can be attributed to the fact that the generation referred to as the “Baby Boomers” is nearing the age of retirement. These baby boomers, born between the years 1946 and 1964, constitute 26 percent of the U.S. population, according to a 2010 Pew Research survey. As more retire, the unemployment rate decreases because the total labor pool decreases.
“The pace of recovery from the ‘Great Recession’ that began in December 2007 remains sluggish,” Nourzad said.
Olga Yakusheva, a Marquette professor of economics, agreed.
“The current state of the economy is improving, but we still have a long way to go,” Yakusheva said.
These numbers could potentially have an effect on this year’s upcoming presidential election.
“It depends on whether the voters feel that the election is about the past or the about the future,” Yakusheva said. “The high rates of unemployment are being used by the Republicans to show the incompetency of the current administration in handling the economy, but the improving trend is to the benefit of the Democratic ticket to demonstrate that the economy is on the right track. Who you side with is up to you.”
Yakusheva also discussed how the most recent numbers relate to students’ searches for employment.
“You have to know what’s out there,” Yakusheva said. “Wisconsin tends to have lower rates of unemployment than the national average, by about one percent, but even at that, there are many people in Wisconsin who cannot find a job. If you want to get that job you want, you have to work harder, do better, be more proactive.”
Students seem to be well aware of these numbers.
“It makes you wonder where the jobs are,” said Jeff Fuchs, a freshman in the College of Engineering. “I know I pay attention to unemployment rates and will try not to choose a potential career in the fields with high unemployment rates. One of the reasons I chose to study biomedical engineering is the fact that the biomedical field has been consistently expanding. Because of that expansion, I feel confident that I will get a job after graduation.”
Nevertheless, Nourzad said, finding jobs after graduation could be hard on the whole.
“These figures point to a soft job market, meaning that our graduates will have a hard time finding what they might consider acceptable jobs in a reasonable period of time,” Nourzad said. “This is true of most job seekers, but especially of recent college graduates and those who will graduate in the near future who typically don’t have much work experience. This fact underscores the importance of having internships, co-ops or part-time jobs while attending school.”