The Mercatus Center at the George Mason University has an article by Veronique de Rugy claiming that one reason why unemployment statistics aren’t as bad as some might think is that a lot of people have stopped looking for work. She says more than half a million people have just quit trying. De Rugy does other work for the American Enterprise Institute and Cato, and so might be accused of taking a dim view of the situation, but she cites Bureau of Labor Statistics data for her conclusions.


Using data from the Obama administration’s website and the Bureau of Labor Statistics, this chart shows the month-over-month changes in the number of unemployed workers and members of the civilian labor force in tandem with the administration’s stimulus spending. By using dual measures of employment instead of simply examining monthly changes in unemployment, this chart captures the magnitude of job loss in America more completely – not only have workers lost their jobs, many more workers have also stopped looking for new employment altogether. According to the Bureau of Labor Statistics, in the month of December alone, 85,000 jobs were lost. In comparison, 661,000 people exited the labor force, or 7.7 times the amount of new unemployment.

For those who stay in the employment game things have gotten tougher. One interesting statistic examined by economist Heidi Sherholtz is the applicants to jobs ratio. In December, 2007 there were 1.7 applicants for every new opening. In November of 2009 that ratio had risen to 6.4 to every availability.

Even the New York Times admits that recovery will be tough.  It ascribes the recent increase in GDP to the result of refill orders coming on the heels of the depletion of inventories, off which companies have been living in recent months. But despite the small bump in GDP there is no relief in sight for the jobless, according to the NYT, until new jobs can be created.


with the economy already some 10 million jobs short, there is no job growth on the horizon robust enough to set that upward spiral in motion. And because the economy is already in such a deep hole, a second leg down would mean ever worsening hardship.

The NYT holds out hope that President Obama’s tax credits will stimulate business into hiring more people. But the Washington Post is not so sure. It worries that it will be go the way of Cash-for-Clunkers and hand out a lot of money for no net gain. It notes that a similar proposal was already rejected in 2009 by the Democrat controlled Congress, but notes that President Obama has addressed those issues by including more safeguards against corruption.

The short-term rush of new car sales abated when Cash for Clunkers ended, and it’s likely that home sales will droop, too, when the real estate credit ends this spring. What’s to prevent a repeat of the same pattern with the jobs credit? Will businesses keep their new hires on the payroll once the credit expires and their taxes go back up? Only if market conditions warrant doing so. And just as cash for clunkers conferred a windfall on some people who would have bought new cars without it, the president’s proposal would reward some businesses for hiring decisions they would have made anyway.

As with all such tax breaks, there would be incentives to game the system, which is one reason Congress balked at a similar plan in 2009. The Obama plan, to its credit, tries to reduce opportunities for corruption. For example, to prevent companies from splitting five full-time jobs into 10 “new” part-time jobs, the plan caps the credit for new hiring at 25 percent of a firm’s wage base. But any credit generous enough to stimulate real hiring is probably generous enough to stimulate attempted cheating.


The Washington Post noted that export growth held out greater promise for job creation, but any attempts to be competitive would require President Obama to take on the unions and left the matter there. Bobby Jindal told Fox News that he expects there would be job growth soon — in India.

The President said he didn’t want us to fall behind countries like Brazil, China, India. But, I’ll tell you what, if they pursue card check and cap and trade and this massive health care bill and more government borrowing and more government taxes, we will be sending even more good paying American jobs to those countries.

It’s safe to say the employment market will remain tough into the forseeable future. People are still in the woods and the end of the forest is not yet in sight.

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