It's Now Indisputable: We Have A Jobs Crisis

Now can we agree that there is a jobs crisis [1]?

The Bureau of Labor Statistics reported [2] an anemic number of new jobs created in May, 54,000. In other words, we're moving backward in terms of putting Americans back to work, as indicated by the uptick in the unemployment rate, to 9.1 percent.

For those who have been watching the other signs of economic slowdown in the past few weeks, from the continuing high level of weekly jobless claims to the double-dip recession now fully underway in housing, this is no surprise. Hours before today's jobs announcement, Bloomberg News noted [3]: "Manufacturing grew in May at the slowest pace in more than a year, according to Institute for Supply Management data this week, reinforcing concern the industry that led the U.S. recovery is cooling. Consumer spending grew less than forecast in April as households felt the pinch of grocery and energy costs, a Commerce Department report showed."

What is clear now is that the focus on austerity in Washington, and the abject refusal by both parties to forcefully advance aggressive proposals to create jobs, is fatal to the aspirations of the 13.9 million unemployed, 8.5 million part-time workers who want full-time work and 822,000 workers who have given up their job search.

Here's how our co-director Roger Hickey sees today's jobs report:

"The anemic employment picture reported today shows that conservative budget cutting threatens to throw an already-weak economy back into recession. With European austerity policies crippling global growth, high energy prices, and the end of fiscal and Federal Reserve monetary stimulus, the U.S. government is now fixated on destructive budget cutting. As a result, it is now clear that Americans, unless we adopt new job creation policies, can expect a long period of high unemployment – not the robust growth necessary to create jobs and reduce the number of people looking for work. Because of cutbacks in state governments, this month’s jobs numbers are especially disappointing, demonstrating that this is not the time for government to be sending pink slips to workers while we are still trying to climb out of a recession.

“Polls demonstrate that the American majority cares more about chronic joblessness than budget deficits. Now, as the slow recovery threatens to stall out, the most important thing Congress and the President can do is to back away from negotiations to dramatically cut back on health and retirement program. And if we really want robust job creation that both parties claim they want, we will need an emergency program of expanded public investment. We cannot let high levels of unemployment become the new normal.

"And after the economy actually recovers, we can pay for it by raising taxes on millionaires and billionaires. The tenth anniversary of the Bush Tax cuts is June 7, 2011, and Americans are counting the costs of that decade of rewarding the rich while ignoring public investment that fuels productive growth and job creation.

"The U.S. economy is puttering along at a tepid growth rate of 2 to 3 percent – not fast enough to put Americans back to work. The private sector is focused on profits and not on productivity. Roughly 9 percent of Americans who want to go to work cannot find job."

"I'm not surprised, but we're alarmed," said Mary Kay Henry, president of the Service Employees International Union, on CNBC after the jobs report release [4]. The loss of 29,000 public sector jobs in May, adding to the 44,000 public sector jobs lost in March and April, is a major reason the unemployment rate went up this month.

When asked how could the private sector create jobs when there is so little demand in the economy, Henry had a ready answer. "I would like to see the government and the private sector make a deal about the $2 trillion of infrastructure investment we need," she said, referring to schools, transportation and other public facilities. These are ways that the government can stimulate demand when consumer demand is slack, she said.

There are millions of jobs that need to be done, from green energy and conservation to highways and public transportation. "There is an issue of our political will," she said.

Having so many millions of people who are out of work and unable to take care of their families "is wrong in this country. We have better values than that," she said.

Likewise, Scott Paul, director of the American Alliance for Manufacturing, noted that "the manufacturing rebound has faltered," with that sector losing 5,000 jobs.

"We can turn this around, but only with positive steps from Congress and the administration. Voters should be outraged that the jobs deficit is nowhere on the agenda in Washington. We need sustained investments in infrastructure, innovation, education, and a rebuilding of manufacturing, but instead all we see is a blind obsession with the federal deficit.

"A rebound in manufacturing is essential to the health of our economy, but it will not be possible without a serious strategy or with a long overdue rebalancing of our economy."

It is past time for grassroots Americans to demand a crisis response to unemployment. Some elites on Wall Street—the latest being analysts at Wells Fargo, one of the Wall Street behemoths responsible for the destruction of the Main Street economy—believe that the country is settling into a "new normal" [5] of 7 percent unemployment; that our problems are "structural" and there is little we can or should do in the short term to address them—except to give more tax breaks to the richest Americans and corporations and wait to see what trickles down.

We must fight back against those who would lock the country into long-term economic despair. This summer progressive members of Congress and members of organized labor are working on a jobs tour to highlight the unemployment crisis and to give voice to the people who reject the idea that we should not be taking immediate measures to put people back to work. Watch for the details of that tour. Be prepared to show up at tour events in big numbers. Let's prepare to mobilize and take back the debate, and the American Dream that people who are willing to work can find decent work.