I’ve contended that our economy, nationally and locally, remains week. The recent unemployment figures confirm that view. See, U.S. Economy: May Employment Gain Trails Forecast (Update1) – Bloomberg.com.
The details of the latest report reveal a grim picture:
American companies hired fewer workers in May than forecast and workers dropped out of the labor force, indicating government support is still needed to spur economic growth.
Private payrolls rose by 41,000, Labor Department figures showed today, trailing the 180,000 gain forecast by economists. Including government workers, employment rose by 431,000, boosted by a jump in hiring of temporary census workers….
“The labor market is extremely weak and has been in a mild recovery,” said Steven Wieting, managing director of economic and market analysis at Citigroup Global Markets Inc. in New York. “Policy makers need to be careful. No one should be taking stability for granted….”
Temporary census jobs accounted for 411,000 of the May increase in payrolls, leaving the ex-census figure at 20,000. The hiring of temporary workers to conduct the decennial population count probably peaked last month, economists said.
The unwinding of census employment may keep distorting the payroll figures for months as the government dismisses workers when the count is completed. For that reason, economists say private payrolls, which exclude government jobs, will be a better gauge of the state of the labor market for much of 2010.
The federal government squandered hundreds of billions on a stimulus that hasn’t reinvigorated our economy, and reliance on hiring hundreds of thousands of temporary census workers will only temporarily obscure our bleak employment scenario.
Locally, reliance on taxpayer-provided grant money and the issuance of taxpayer-financed municipal debt will offer no longterm boost to our economy. The only meaningful increase our community will see, for example, from a multi-million dollar Innovation Center is an increase in empty, press releases.
More significant, the federal government’s failed stimulus and red-ink budgets mean that the supply of federal pork will soon run out.