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Hard Truths Behind Today's Job Numbers

The opinions expressed by columnists are their own and do not necessarily represent the views of

New jobs and unemployment figures came out today, which on their face depict an economy that looks better than many pessimists had anticipated. Understandably, they are being greeted as welcome news from a public desperate for job growth and economic recovery, and an end to the hardship, pain and misery that so many Americans have experienced over the last few years.


But while I am all for good news, a couple of hard truths must be told as these numbers are scrutinized today.

First, the U.S. workforce is not nearly the same size as it was when President Obama took office, let alone this time five years ago. According to AEI's James Pethokoukis, "If the size of the U.S. labor force was as large as it was when Barack Obama took office, the unemployment rate would be 10.9 percent. But since so many people have gotten discouraged and stopped looking for work– and thus disappeared by government statisticians — the jobless number has been artificially depressed. A better gauge of the jobs picture is the broader U-6 rate, which includes part-timers who would rather have full-time jobs. It stands at a whopping 15.2 percent."

As Pethokoukis notes in his post, pointing to data highlighted by Hamilton Place Strategies, further scrutiny of other numbers, like labor force participation, results in an even less rosy picture: "Labor force participation averaged 66 percent through most of the 2000s. It now stands at 64 percent after declining again last month. If more people were still looking for jobs, and the participation rate were back up at 66 percent, the unemployment rate would now be 11.4 percent instead of 8.6 percent."

Second, according to Betsey Stevenson, a former Chief Economist at Obama's own Department of Labor, people with education at or below the high school level are still losing jobs, while the only job growth that we are seeing is among better-educated workers. Earlier today, she tweeted, "All the gain in empt in this report was for those w/ educ--loss of 204K jobs for high school & below, gain of 301K for some college & above." This should be a real concern, moving forward.


The big truth here is that we need to do better, and we’ve needed to be doing better, for a long time now. It will not surprise me if the Obama Administration and his political advisers start trumpeting these numbers as proof that their policies have worked to get the country out of the mess that bad policy created and exacerbated. But the truth is, they could and should have pursued a different economic approach that would have gotten the economy moving much faster, and created more jobs for all kinds of workers faster. They had an example in my state, Texas.

In Texas, we have consistently followed a few basic, common sense principles where economic policy is concerned. First, don’t spend all the money. Second, keep taxes low. Third, keep regulations in check. On my watch, the state has seen the addition of one million net new jobs, while the rest of the country lost two million. These jobs cut across industries, too: Some were in the energy field (oil and gas, but also wind power), some were in the tech sector (as anyone who has visited Austin recently could guess), some have been in the service sector, and so on. We’ve created jobs for high-skilled workers, unskilled workers and everyone in between.

We have also gotten more people into the labor force, while the country as a whole has seen a decline. From November 2010 to November 2011, Texas added 168,500 people to the labor force. From just October 2011 to November 2011, we added over 20,000 new workers; in the other 49 states, close to 150,000 dropped out.


America needs to start implementing policies we know will work based on experience. We can do this. We just need the right leadership, and the courage to end the statistical shell games that Washington uses to hide the truth from the American people.

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