Last week the Bureau of Labor Statistics started a frenzy when it released its latest job report, showing that only 54,000 jobs were added to the economy in May.
The White House says don't worry too much about those numbers; it only represents one month. Austan Goolsbee, chairman of the Council of Economic Advisers, told The Associated Press that the addition of a million new jobs over the past six months shows “we have improved a long way from when the economy was in rescue mode.”
That's true. And, I think the White House ought to get more credit for keeping the economy from falling off the cliff. But at the same time, the future prospects for job creation are bleak. Why? The Republicans are demanding a policy of major governmental contraction while the White House is "negotiating" for a policy for some contraction.
Either way, all governments are shrinking. The economy is going to lose a you-know-what load of jobs or a mega-load of jobs. Either way, there are a lot of minus-signs ahead.
The May jobs report hints at what's to come. First, it said, long-term unemployed — those out of work for 27 weeks or more — continued to grow by 361,000 to 6.2 million people and "their share of unemployment increased to 45.1 percent," the BLS said.
So what’s the government doing for the long-term unemployed? Not a damn thing. The overriding idea is that some magical private sector beans are going to be planted soon and grow jobs for millions of people.
At the same time, the numbers of long-term unemployed continue to grow, the government sector is cutting its own workforce. Big time. "Employment in local government continued to decline over the month," the report said. Local government lost 28,000 jobs last month and 446,000 jobs since a peak in September 2008. That’s just the beginning. If the trillion dollars worth of cuts demanded by Republicans come into being, those job losses will look small by comparison.
Another industry hit by government contraction: Construction. When government at all levels cuts back on infrastructure, there are fewer jobs building roads, schools, buildings. Here is what the Bureau of Labor Statistics report says about that: “Construction employment was essentially unchanged in May. Employment in the industry has shown little movement on net since early 2010, after having fallen sharply during the 2007-09 period.”
How does Indian Country fit into this picture? That’s a tough question to answer because so much of the data is old and often unreliable. (More than ever: Indian Country needs real time data, but that’s another column.) But we do know for certain that unemployment is significantly higher in American Indian and Alaska Native communities.
The Bureau of Indian Affairs' Population and Labor Force Report pegs it at near 50 percent nationally (showing South Dakota with the highest unemployment rate at 83 percent of the adult workforce). However, a report last year by the Economic Policy Institute, using a different methodology, showed an unemployment rate of 21.3 percent in the first half of 2010. (Like the BIA, EPI also found unemployment rates significantly higher in the Great Plains.)
Of course, the problem with all of those numbers — bleak as they are — is that they look backward, not forward. What are the prospects for Indian Country in this new environment of contraction? Remember government, at all levels, is in a job-cutting mode.
Tribal and village governments have spent the past decade essentially creating jobs both in government and in the private sector (but even private jobs are often tied to government through construction and other infrastructure projects). The problem is those jobs have not kept up with an expanding population, because Indian Country is a younger workforce.
When it comes to jobs — nationally and in Indian Country — there is an insurmountable mathematical obstacle. The more jobs that are cut by the government means that many more must be created to put the long-term unemployed back to work.
It’s been said that Indian Country is in a permanent recession. But the sad truth is it could get a lot worse — and it’s a path we're on right now.
