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April 10, 2013

March Job Creation Flatlines

Kevin E. Dayhoff

Last Friday the Labor Department announced the unemployment numbers for March and it was not a pretty picture. The Obama Administration quickly mustered the mainstream media and the party faithful spinmeisters to parrot that the numbers were as a result of the sequestration that only took effect at the beginning of the month.


First, just the facts – CNBC senior writer Jeff Cox wrote Friday, “Job creation slowed to a crawl during March, with the U.S. economy creating just 88,000 positions though the unemployment rate fell to 7.6 percent. The number was a sharp slide from February's upwardly revised 268,000.”


The job creation numbers were in stark contrast with the overly optimistic numbers predicted by many economists.


However, what was even more startling was how quickly the mainstream media glossed the anemic numbers over as an anomaly and quickly moved-on to other stories. One can only imagine if such a gloomy jobs report had occurred under a Republican president.


Mr. Cox’s concise article, “US Job Creation Plunges, but Rate Drops to 7.6%,” went on to report, “Friday's report fell short of economists’ expectations of 200,000 new jobs, confirming some of the weakness in recent reports.


“Moreover, the drop in the jobless rate was little more than a statistical anomaly, with the labor-force participation rate tumbling to a 34-year low of 63.3 percent. However, a broader measure of unemployment that counts the discouraged and underemployed also fell, declining to 13.8 percent from February's 14.3 percent.”


Last Wednesday, Reuters reported, “Companies hire fewer in March, service sector growth slows.” The article observed: “Companies hired at the weakest pace in five months in March as recent strong demand for construction jobs evaporated, while growth in the vast services sector slowed, signs that the economic recovery could be hitting a soft patch.”


Actually, numbers were not really ‘soft patch’ or that surprising to Main Street America, which continues to see soft customer demand and continued sluggishness in cash flow and liquidity.


Even with years of pent-up demand fueling some uptick in the sales of goods and services, cold weather and a continued lack of confidence in the administration’s fiscal policies are still keeping customers away.


Increased costs, taxes and regulatory burdens are keeping businesses from expanding or pursuing additional hiring.


According to John Hayward, writing for the conservative opinion journal, Human Events, “…the size of the workforce fell to a new 30-year low, as nearly half a million people exited the job market completely. Some of this could be attributed to the demographic shift of an aging workforce entering retirement, but that doesn't explain why youth unemployment is especially dire.”


The Washington Post reported that the Obama Administration stated that employment would be impacted from “what it called Washington’s ‘self-inflicted wounds.’ ‘While the recovery was gaining traction before sequestration took effect, these arbitrary and unnecessary cuts to government services will be a head wind in the months to come,’ said Alan B. Krueger, head of President Obama’s Council of Economic Advisers.”


Yet, in the same article, the Post explained, “a significant decline in the number of people in the workforce suggests that March’s results were not a fluke. Nearly half a million people left the job market, bringing down the percentage of Americans in the labor force to the lowest level since 1979. That helped bring the unemployment rate down to 7.6 percent, but for all the wrong reasons.”


Mr. Haywood did not mince words in his analysis of the administration’s specious-spin on the dismal employment numbers and the economy that continues to fail to thrive.


“The Administration is, absurdly, trying to spin this workforce collapse away as fear of sequestration – as though job creation would flatline, and 496,000 people would bail out of the workforce, because the federal government will only spend $25 billion more next year, instead of $68 billion more.


“If there is even the slightest element of sequester terror to these job numbers, who could be held more at fault than Barack Obama, who employed a deliberate strategy of magnifying public anxiety over sequestration.”


As summer approaches, and President Obama slides sideways into the third month of his second term; we lurch forward into the fifth year of Obamanomics; a non-policy of one excuse after another for the economy’s lack of performance – after spending several years of blaming it all on the previous administration.


Mr. Hayward said it best: “It's simply ridiculous to think sequestration would rattle private-sector employers more than the looming horror of ObamaCare, the tax increases already lumped on their backs, the President's single-minded determination to raise taxes even more, or the job-strangling encroachment of the hyper-regulatory State.


“There is nothing about Obama's past policies, or plans for the future, that would make most rational employers think expansion and hiring are good ideas – particularly in the vital small business sector.”


Never mind the recent record levels set in the stock market on Wall Street. Even the unsophisticated in the vagaries of the financial markets understands that the bubble-market created by the Federal Reserve is simply without a solid economic foundation and unsustainable – and it certainly is not trickling-down to the local economy in Hometown, America.


The average Mom and Dad is still wrestling with increased taxes, more expensive groceries, gas and utilities, and a sharp increase in the cost of healthcare. Not to be overlooked is a generalized non-specific anxiety and malaise that pervades the average family’s view of the immediate future.


Too many families fear of becoming just another statistical road kill on our country’s highway to a social-welfare state that has all the responsiveness and nimbleness of a planned central economy based on full employment for a highly-stylized bureaucracy with a mandate to punish the successful and redistributes any accumulated financial resources.


. . . . .I’m just saying…


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