Labor Recovery Leaves More Workers Behind

9/6/13
 
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from The Wall Street Journal,
9/6/13:

Solid Hiring Comes in Lower-Paying Sectors; Participation Rate at Lowest Level Since 1978.

The long, slow recovery in the U.S. job market is leaving ever-more Americans on the sidelines—and complicating the calculus for Federal Reserve policy makers weighing when the economy can get by with less help.

Employers added 169,000 jobs in August, the Labor Department said Friday, a bit more than in July, and the unemployment rate fell to 7.3%, the best mark of the recovery.

But beneath such positive numbers lay evidence of a job market stuck in second gear. The government revised down its estimate for June and July hiring by a combined 74,000 jobs, and a disproportionate share of the jobs that are being added are in low-paying sectors such as restaurants and retail. At the recent pace of hiring, the economy won’t get back to prerecession levels of employment, adjusting for population growth, for more than eight years.

The unemployment rate, meanwhile, fell not because people found jobs but because they gave up looking. The number of people reporting they had jobs—a measure based on a separate survey from the one used to calculate payroll gains—fell by 115,000 in August. As a share of the population, fewer Americans are working or looking for work than at any time in the past 35 years.

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