March 04, 2011
The economy generated 192,000 new jobs in February, knocking the unemployment rate down to 8.9 percent, according to the latest Bureau of Labor Statistics report. The unemployment rate has now dropped by 0.9 percentage points in the last three months. According to BLS’ establishment survey, job growth during this period has averaged just 136,000, which is only slightly faster than the 90,000 rate needed to keep pace with the growth of the labor force.
It is difficult to reconcile the sharp drop in unemployment with the weak job growth. Generally, the establishment survey is much more accurate since it has a far larger sample and it is benchmarked every year to unemployment insurance data, which provide a near census of payroll employment. Other data in the establishment survey are consistent with the picture of modest job growth. However, there is nothing to suggest the strong job growth necessary to restore full employment. At the rate of job growth over the last three months, it would take almost 14 years to get back to normal rates of unemployment.
For more, check out our latest Jobs Byte.
