Finding the Silver Lining in the Grim Jobs Report
A lot of news reports in the next few days will focus, correctly, on the generally dismal jobs picture the Bureau of Labor Statistics (BLS) just announced. There’s no doubt that the recovery, such as it is, remains awfully slow. But amidst all of the doom and gloom reporting, there are two bright spots that are being overlooked.
First, regarding the jobs picture, the reports of a moderate gain in private employment may actually turn out to be larger than expected. In general, official reports on unemployment tend to undercount the number of private jobs gained when the nation is emerging from a recession. Small startup businesses create a great number of new jobs (although this has been sometimes overstated) and BLS compiles job reports largely by sampling existing employers. Particularly during periods of economic recovery, a lot of employers will be new businesses that BLS doesn’t know about yet. This isn’t a major factor—even a big undercount of people working for these new companies probably wouldn’t result in a joblessness over-count of more than a few tenths of a percent—but it does offer hints that the recovery may be a little stronger than the statistics suggest.
Second, whatever the overall economic consequences of the recent healthcare bill, the industry that will see the most direct consequences from it—healthcare itself—seems pretty confident. Just about a third of all new jobs created were in the healthcare field (about 16 percent of the economy) which has added jobs in every month of 2010. This doesn’t prove that Obamacare is a good idea—it’s not—but it does seem to indicate that predictions that the mere passage of the bill would lead to a mass exodus from the medical field were overblown.