Part-time jobs account for 97% of 2013 job growth
posted at 9:21 am on August 5, 2013 by Ed Morrissey
Being on vacation last week meant that I missed the jobs report for July, which turned out to be as unremarkable as most of those in the four-plus years of the so-called economic recovery. The media reports I did catch while on the cruise focused mainly on the fact that the jobs added in July missed the expectations of analysts, and not on the fact that adding only 162,000 jobs meant another extension of stagnation, as the US economy needs ~150,000 jobs added each month just to tread water, thanks to population growth. That’s not even a decent maintenance number, let alone the kind of job growth needed to put the chronically unemployed back to work.
The media reports also missed another trend in job reports, one caught by a former chief of the Bureau of Labor Statistics and reported by McClatchy’s Kevin Hall this morning. Almost all of the job growth this year came in part-time work — and when we say “almost all,” we mean 97% of it:
The unemployment rate is measured by the separate Household Survey, and it fell two-tenths of a percentage point to 7.4 percent, its lowest level since December 2008. That’s due in part to slow growth in the labor force. The jobless rate is based on a sample of self-reporting from ordinary people across the nation, and it’s the Labor Department measure that shows a very troubling trend in hiring.
“Over the last six months, of the net job creation, 97 percent of that is part-time work,” said Keith Hall, a senior researcher at George Mason University’s Mercatus Center. “That is really remarkable.”
Hall is no ordinary academic. He ran the Bureau of Labor Statistics, the agency that puts out the monthly jobs report, from 2008 to 2012. Over the past six months, he said, the Household Survey shows 963,000 more people reporting that they were employed, and 936,000 of them reported they’re in part-time jobs.
“That is a really high number for a six-month period,” Hall said. “I’m not sure that has ever happened over six months before.”
And Hall says there has to be something driving that kind of trend, and thinks he knows what it is:
“There is something going on if such a large share of the hiring is part time,” Hall said. …
Hall speculated that the implementation of the Affordable Care Act, shorthanded as Obamacare, might be resulting in employers shifting workers to part-time status to avoid coming health care obligations.
“There’s been so much talk about the effects of Obamacare on part-time work,” he said. “This is such an unusual thing to see.”
Forbes’ Chris Conover wrote about this trend last week, before the BLS published the July jobs report:
Denialism may be too strong a term. But there seem to be a lot of people arguing that Obamacare has little or nothing to do with the rise in part-time employment. Some deny the rise is even happening, while others are content to deny that Obamacare is the culprit. Admittedly, it takes a little detective work, but if we systematically review the available empirical evidence in an even-handed fashion, the conclusion seems inescapable: Obamacare is accelerating a disturbing trend towards “a nation of part-timers.” This is not good news for America. …
Ratio of New PT Workers to New FT Workers Explodes in 2013. For the most part, an examination of metrics measured in millions (e.g., involuntary PT workers or total PT workers) masks what is really going on. A much better sense is given by comparing the changes in PT employment to the changes in FT employment. Because the monthly Current Population Survey are so volatile, it is easier to see what is going on by calculating an average monthly figure for each calendar year to get a sense of whether the number of PT or FT is rising or falling. We only have six months of data for 2013, but this method allows us to compare the average monthly count for the year to date with the average monthly count from prior years on an apples-to-apples basis. We can then calculate the ratio of new PT workers in an average month to new FT workers in an average month. Obviously this ratio will turn negative in years that either FT or PT workers have declined on average. So over the past decade, there’s only 4 other years with which to compare the 2013 experience.
What should immediately be obvious to even someone without a shred of statistical training is how deviant the 2013 experience is compared to the past. For every new FT job added to the economy, there were 4.3 PT jobs added! In most (non-negative) years, the ratio is the reverse: that is, there are typically 5 FT jobs added for every new PT job. Even in 2004—the year with the second-highest ratio during this time-frame–there were 2 FT jobs for every PT job, yielding a ratio of 0.5. Even if growth in PT vs. FT workers reverted to its historic pattern for the balance of 2013, the year’s average monthly ratio still would be four times as large as the 2nd highest ratio from 2004.
The July report only confirms that trend. Only 92,000 full-time jobs were created, while 172,000 part-time jobs got filled (not net numbers). The only major influence in 2013 that differs from the preceding three years of the recovery is the impending ObamaCare mandate on employers, which the Obama administration will try to postpone for a year. The data shows that businesses have already begun to react by minimizing their risk and costs through part-time employment, thanks to the perverse incentives set up by the ACA, and that this will continue as long as the mandate exists.
Maybe that’s why it’s so difficult to find ObamaCare defenders these days — at least unpaid ones. OFA tried to stage a rally in Centreville, Virginia yesterday, but only one person bothered to attend, and even the organizer took a powder after less than a half-hour on the job:
That means gatherings like today’s in Centreville — although the slow start here is probably not what OFA organizers had in mind. After a scheduling snafu over the start time, a few people showed up and left before it actually started. Just one volunteer stayed to help work the phone bank for the health law, and the event’s organizer bolted after 20 minutes — although he was bound for another Obamacare event, a house party.
Another part-time worker, eh?