The viscera of the labor market

A typical comment:

U.S. employers added 252,000 new jobs in December, marking the strongest year of job growth in 15 years, while the unemployment rate dropped to 5.6%, the Labor Department said Friday. But wages aren’t taking off, with average hourly earnings falling from November and up only 1.7% from a year earlier.

On the “wage worry” see Scott Sumner´s post.

On the “strongest year of job growth in 15 years” simply note the following:

In the 23 months from February 2008 to December 2009, 8.7 million jobs were ‘lost’. During the following 60 months, up to December 2014, 10.7 million jobs were ‘created’.

Bottom line: Over a period of 7 years, net job creation was all of 2 million! (During those same 7 years, working age population increased by 7.2 million)

Far from being the “new normal”, affected by demographic factors, that´s the outcome imposed by a monetary policy that works hard to keep the economy in a depressed state.

But they rejoice in the relative ‘wellness’ of the US! Poor others!

One thought on “The viscera of the labor market

  1. Yes, the Fed has been so wildly expansionary that we now have falling unit labor costs in the United States and at the next Iindex release will probably be below 2008 levels.
    This is something new under the sun: a “wildly accommodative central bank” and falling unit labor costs.
    Gee, do you tthink maybe the Fed is actually too tight?

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