Unemployment Numbers Improve, But Are Still Dreadful for Millennials
A generally encouraging jobs report was released Thursday, inspiring some confidence that the limping economy was recovering.
A generally encouraging jobs report was released Thursday, inspiring some confidence that the limping economy was recovering. According to Forbes:
The Bureau of Labor Statistics released a surprisingly strong jobs report Thursday morning.
Employers added 288,000 jobs in June, significantly more than the 215,000 economists were anticipating. The unemployment rate, which is drawn from a different survey of households, dropped from 6.3% to 6.1% the lowest rate since September 2008.
Immediately following the news the S&P 500, The Dow Jones Industrial Average and Nasdaq Composite were in the green, continuing positive trends seen leading up to the pre-bell release. The Dow crossed 17,000 for the first time ever seconds after the opening bell before settling around 17,050.
The May payroll number was revised up from plus 217,000 jobs to plus 224,000. April's employment number was also revised from 282,000 jobs added to 304,000. Total employment gains those months were therefore 29,000 higher than BLS — a division of the Department of Labor — previously reported. Job growth averaged 272,000 for the last three months.
"This was a strong report any way you slice it," wrote RBS U.S. Economist Omair Sharif in a note on the news. Sharif pointed out that the unemployment rate is "where the Fed thought we would be at year-end, and it's only June."
The New York Times' Neil Irwin writes that while the numbers are indeed inspiring, there is good reason to be cautious. The job market has periodically experienced an errant, solid quarter only to plummet again:
So the reasons I'm saving the fireworks for the July 4 holiday, rather than this jobs report, is not because there is some obvious soft underbelly. It's because we've kind of seen this before.
Do you remember January 2012? Those ancient days when "How I Met Your Mother" was on television and Adele's "Someone Like You" was on the radio? Yes, it was a distant time. It was also a month in which employers added even more jobs than June, with 360,000 reported new jobs.
There has been a lot of rumbling that the economy is starting to burst out of its shell, with robust, above-trend growth really arriving for the first time in five years of recovery. And that may be true! But if this halting, sluggish recovery has taught us anything, it is to not let our assessments of the economy be driven by hope, but rather by sustained and credible improvement in a wide range of economic data.
While unemployment may have fallen, there is still bad news for millennials: They make up 40 percent of the jobless. According to The Wall Street Journal:
Some 40% of unemployed workers are millennials, according to an analysis of U.S. Census data by the Georgetown University Center on Education and the Workforce released to MarketWatch, greater than Generation X (37%) and baby boomers (23%). That equates to 4.6 million unemployed millennials — 2 million long-term — 4.2 million unemployed Xers and 2.5 million jobless baby boomers.
"I was surprised by how high that number is for millennials," says Andrew Hanson, research analyst at Georgetown University, who conducted the analysis. "Unemployment is becoming a youth problem."
Young people have been hit hardest by the recession and have had a more difficult time finding jobs than older generations.
The WSJ points out the potential political ramifications of a large, unemployed, disillusioned voting block:
The high level of unemployment could leave a generation of disillusioned young voters — a sizable block. Only 25% of 18- to 29-year-olds will "definitely be voting" in the midterm elections in November, down from 34% five months ago, according to an April 2014 poll carried out by the Harvard University Institute of Politics. Some 47% of 18- to 29-year-olds say they approved of the performance of President Obama, a drop from 54% a year earlier. Millennials also make up a considerably powerful group. There are 89 million millennials compared with 49 million Generation Xers and 75 million baby boomers.