Answer Desk's John Schoen fielded readers’ questions in a live chat Friday about the February unemployment report. Read below for some of their questions and his answers.
Marty: Is the jobs report good news or bad? It seems that with the huge snowstorms we had, this was not nearly as bad as feared. Maybe we have really turned the corner?
The numbers do seem to indicate that the economy — and the job market — are turning a corner. But what’s around that corner?
The potential impact of the snowstorm may have been overstated, by us and other writers and analysts. We based those concerns on the historical pattern the last time there was a big snowstorm during the week the Department of Labor conducts its jobs survey, every month during the week that includes the 12th.
It turns out there were other factors that may have introduced “noise” to this month's number, including the hiring of a large pool of temporary Census workers.
But the revisions to prior months, which showed fewer jobs were lost that originally estimated, is clearly good news. The hope is that the worst of the mass layoffs of last year are behind us. Now the question is: What comes next?
Frank: How can we have turned a corner when the unemployment rate has, at best, remained flat? Ten percent a few months ago is still 10 percent today. I am still no closer to finding a job then I was last year. How does anyone feel things are better?
“Better” — at this point — is a relative term. If you take an aspirin to get rid of a nasty headache, you would probably report that you’re feeling “better” if the pain starts to go away, but you still feel groggy.
That’s where we are right now. The searing pain of layoffs that sidelined more than 8 million people in two years seems to be fading. But we are still feel lousy. And it’s far from clear how long its going to take to shake off the illness that gave us the headache to begin with.
Chris: Is it possible that with the economy improving we may see the unemployment rate increase as more people re-enter the workforce looking for work?
That may very well happen. Economist Mark Zandi at Moody’s Economy.com thinks the jobless rate will begin rising again — hitting 10.5 percent by Election Day.
It’s not unusual for the unemployment rate to rise at the end of a recession for the reason you cite. There are something like 2 million people who have left the official count of the workforce in the past two years because they gave up looking for work. As the job market gets better, they will likely re-enter the “official” workforce much faster than the economy creates new jobs.
That means the rate, or the percentage of the now-bigger workforce without jobs, goes up. It's a math thing.
S. Cole: Do you think the reason job layoffs have eased is because most companies have let go as many employees as they possibly can, and those employees that are left must still get all of the work done?
This is the main reason we’re seeing big gains in “productivity” in the economic data. As companies large and small have slashed payrolls, they’ve been asking their remaining workers to pick up the slack left by their former colleagues in a quest to squeeze more profit from every hour worked.
The Labor Department reported Thursday that productivity jumped at an annual rate of 6.9 percent in the fourth quarter, even better than an initial estimate of 6.2 percent growth.
But it’s hard to see how this productive surge will last — there's a limit to how much more work the people who are still employed can do.
John: Beyond the normal spin about whether the report is good or bad, there are always various opinions about if the government can do much of anything to create jobs. Seems that employment, and the economy, varies like the waves on a sea, while politicians toss teaspoons of water into the ocean and claim positive results when the water rises. Is there really anything significant the government can do to alter the jobs picture in the long run?
Government policies can’t cure a sick economy, but they can help it heal itself. But it’s not always easy to get the right policies in place.
For starters, the “experts” who dream up ideas about what government should do don’t agree. Some have complex mathematical models to prove their point.
Even if those folks could agree on the “right” thing to do, you then have to get these policies through the political process. That’s even tougher to get right.
But government policies play a very important role. Extending unemployment insurance, for example, isn't just the right thing to do — it helps support consumer spending when unemployment is high. That helps blunt the impact of consumers cutting back. Raising taxes in a recession, on the other hand, doesn't help small businesses create new jobs.
What's most troubling to me personally is that the political "debate" over what to do has overshadowed the question of what works and what doesn't. We're all seemingly more interested in assigning blame — based on preconceived ideological biases — than discussing the cause of the problem and working toward real solutions.
Some readers try to discern my own politics based on what I write. All I can say is that I have never registered with, or donated to, any political party. My politics are "fact-based."
Doug: The biggest problem I see is that we have made it lucrative to be unemployed. There are jobs available, people just don’t want them. Truth is, why work when your food is free? [...] The majority of the time I offer someone a job, the response is, “That’s just a little more than I’m making on unemployment, no thanks.”
I suppose there may be people who don’t want to work – who are happy to have the government pay their bills.
But I have yet to meet an unemployed reader who doesn’t want a job.
I may be naïve, I think it’s a pretty basic human need to have a purpose in life. The vast majority of people I hear from want desperately to go to work, feel like their part of a larger enterprise of some kind and go home at the end of their day feeling that, at the very least, they helped support their household.
The problem that I see is not that people don’t want to work — it’s that to many of them don’t have the skills required to fill the jobs that are out there. That may require a different kind of assistance, but it seems to me it would be an investment well spent. If we don’t invest in our workforce, other countries we compete with are very happy to do so.