Slowly but surely the economy is heading in the right direction. If the economy is a patient (I'm a trauma surgeon so I like to use medical analogies, sorry), the patient is still in the ICU. The patient is still on multiple antibiotics. The patient is still on a ventilator but the patient is getting better. The patient is heading in the right direction. An infusion of 244,000 new jobs is part of the prescription for getting the patient back on his/hers feet. Over the last three months, private sector jobs have grown by over 700,000. This is all good news. Yet, as I said in previous months, it is not time to do the happy dance. It is time to give our patient an infusion of more jobs (stimulus) which will really jumpstart the economy. This is what is desperately needed. Unfortunately, the political atmosphere in Washington will not get this done. No meaningful legislation will come out of the House in the next 18 months that is going to help the economy. Republicans who control the House don't believe in economic stimulus packages (they don't believe in data either but that's another post). They simply don't.
We still have 14 million Americans who are unemployed. 14 million Americans! At our current rate of job growth we can get our unemployment level back to prerecession levels by the year 2016. Who can wait that long?
If you look at the numbers more critically and breakdown unemployment by groups, certain groups are clearly hurting more than others. The unemployment rate among our youth (16-24) is a whopping 17.6%. For those youth with only a high school education the unemployment rate averaged 21.8% last year. The unemployment rate among African-Americans is 16.1% and among Hispanics is 11.8%. The unemployment rate among men is 9.4% and among women 8.4%.
Wages are stagnant. Hourly wages rose a poultry three cents in April. With 14 million Americans unemployed currently the economic pressure is not there for employers to raise wages. (great article by Rick Newman about why wages are stuck in neutral.)
So, we need more jobs. We need better paying jobs.