As the Great Recession was taking hold in 2008, there was no joy in reporting dismal monthly unemployment data. As the job cuts grew, thousands of Americans were losing their livelihoods each month. I would often hear criticism about why the financial media was reporting the unemployment numbers instead of focusing on how many people were employed.
It was a matter of perception of the job market, not credibility, as investors longed for some positive news in an otherwise dismal period. But perception couldn’t change the data.
Nine years later, and with the stock market at record highs, President Donald Trump is pushing a perception of the job market that, while accurate, is crudely political. In his speech to the joint session of Congress, the president said, “Ninety-four million Americans are out of the labor force.”
Yes, that is an accurate number as of January. It’s also near a record high and it is troubling. But it also is misleading. According to the Bureau of Labor Statistics, 89 million of the people not working do not want to work. They may be retired, or in school, or a new parent, or taking care of their parent, or any of a host of reasons, including they are just plain discouraged and have given up looking for work. But there are not 94 million people — more than a third of Americans 16 years of age and older — pining for a job.
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America does have three significant employment challenges; low worker productivity growth, meager wage growth and a shrinking portion of the working age population who are working or wanting to work.
On Friday when the February jobs report is released, separating the data from perception and politics is the job of investors.
Financial journalist Tom Hudson hosts “The Sunshine Economy” on WLRN-FM in Miami. Follow him on Twitter @HudsonsView. This column, “The Week Ahead,” appears Mondays in Business Monday, a publication of the Miami Herald.