Live by the Jobs Report, Die by the Jobs Report
Partly as a result of Governor Walker’s high-profile pledge to create 250,000 new private sector jobs in Wisconsin, the monthly employment reports have been getting a lot of scrutiny by the media, public officials, and the public.
Last month, the employment figures showed a surprisingly large increase in the number of jobs in the state, a development some were quick to claim as evidence that Governor Walker’s policies were having a positive effect on the state’s economy. Between May and June 2011, Wisconsin added 11,000 jobs. (The figures reported at the time were preliminary numbers and so differ slightly from the final figures now available.) The Milwaukee Journal Sentinel’s Politifact rated as “false” the claim that more than half the nation’s job growth in June came from Wisconsin – but nevertheless, Wisconsin’s job growth in June was a welcome indicator that the state might have economic momentum on its side.
I hope you kept the receipt for the champagne. July’s employment report came out today, and preliminary figures show that the number of jobs in Wisconsin decreased, wiping out most of last month’s gain. Between June and July 2011, Wisconsin lost 8,200 jobs. That’s the biggest month-to-month job loss in nearly two years. The drop in private sector employment was even greater (-12,500 jobs), but was mitigated by a suprising increase in public sector employment. The unemployment rate rose from 7.6% in June to 7.8% in July.
From one month to the next, the number of jobs in Wisconsin has proven to be volatile, especially in this roller-coaster economy. Those who claim that one particular month’s figures are proof that certain policies are working or not working are likely to wind up abashed when the next month’s figures are released. It’s helpful to look at the trends of a period of at least a couple months before drawing conclusions.
Let’s take a longer-term look: The number of jobs in Wisconsin has increased by 22,900 since January 2011. If we assume a 2% annual increase in population, that rate of job growth won’t even keep up with population growth.
Every month, the Center on Wisconsin Strategy puts together the “Wisconsin Job Watch,” which measures the size of the “jobs deficit” – the number of jobs Wisconsin lost during the recession plus the number of jobs we need to keep up with population growth. By this calculation, Wisconsin was 172,800 jobs in the hole last month. This month’s jobs report dug that hole a little deeper.