In Obama’s Economy, More Americans Give Up

The August jobs report shows the economy below where we should be four years after the end of the recession. While the national unemployment rate fell slightly to 7.3 percent for August, the decrease is primarily because 312,000 people stopped looking for work. 

Labor Force Participation

• The labor force participation rate is 63.2 percent, down 0.2 from July, and the lowest rate in 35 years. Last month, 312,000 Americans left the labor force. 

• The participation rate last month for women was 57 percent. For men, the participation rate fell to 69.5 percent, its lowest level since 1948. Analysts note that demographics cannot explain fully the recent decline in participation rates.  

• The share of American adults with jobs in August was 58.6 percent, roughly the same as it’s been for more than three years. This is approximately five percentage points below its pre-recession peak.

• The portion of long-term unemployed is currently 37.9 percent of the unemployed, up 0.9 percentage points from last month. During the 1980s, when our country faced a similar recessionary period, the proportion of long-term unemployed never exceeded 27 percent. 

• Concern has also been raised about the consistent number of Americans who are working part time for economic reasons. These people are working part time because their hours have been cut back or because they are unable to find a full-time position. This figure has averaged 8.0 million all year.

Weeks, Hours & Wages

• The number of Americans searching for work for more than 27 weeks is 4.3 million.

• The average hourly private nonfarm payroll rose by five cents to $24.05. Hourly earnings have risen 52 cents -- or 2.2 percent -- year-over-year. 

• The average work week for private nonfarm employees was 34.5 hours, an increase of 0.1 hour compared to July.  

Employment

• The Department of Labor reported an unemployment rate of 7.3 percent for August 2013, down 0.1 percent from July, and an increase of 169,000 nonfarm jobs. The last two months were revised down 74,000 jobs. June employment figures were revised from 188,000 to 172,000, and July figures were revised from 162,000 to 104,000 new jobs.

• President Obama promised a “natural unemployment” rate of 5.0 percent by now.

• Job growth remains sluggish. In 2012, the economy added an average of 262,000 jobs a month. In 2013, the economy has added an average of 180,250 jobs per month. In the past three months, the average is just 148,000 jobs.

• Employment increased in retail trade (+44,000), health care (+33,000), professional and business services (+23,000), and food services and drinking places (+21,000). Employment in the information sector was down by 18,000 jobs; state government employment fell by 3,000 -- offset by a gain of 20,000 in local government; and financial activities lost 5,000 jobs last month.  

• Americans are beginning to sour on the market for quality jobs. According to an August 2013 Gallup survey, just 21 percent of Americans think this is a good time to find a quality job, its most negative level this year and a four-point drop from July. Prior to last month, Americans’ optimism had appeared to be improving. 

“Real” Unemployment

• The “real” unemployment or U-6 rate is 13.7 percent for August. This is the total percentage of unemployed and underemployed workers.

• The “real” number of unemployed Americans is 21.5 million. These are people who are unemployed (11.3 million), want work but have stopped searching for a job (2.3 million), or are working part time because they can’t find full time employment (7.9 million).

• Among those marginally attached to the workforce, there were 866,000 discouraged workers in August, an increase of 22,000 from last month. Discouraged workers are not currently looking for work because they believe no jobs are available for them.