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Brian Wesbury
Chief Economist
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Bob Stein
Deputy Chief Economist
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 | Recent Job Gains Aren't All Government Jobs |
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Lately, a lot of people have argued that job growth during the economic recovery has been mostly due to government hiring. They argue that since most of the payroll growth has been generated by the government, the recovery is not sustainable and the US is in for a jobless recovery or even worse, a double dip recession. There's just one problem with that, it's just not true. There's no doubt that last month's payroll data was disappointing, with only 41,000 private sector jobs created, but it is not characteristic of the recovery so far. While temporary census hiring skewed last month's payroll data, previous months paint a different picture.
Excluding the month of May that was distored by Census hiring, since November 2009 (the first month of payroll gains since the recession began), there have been 506,000 jobs created according to the Bureau of Labor Statistic's establishment survey. 446,000 of these have been from the private sector, or 88%. This is a very strong number considering that government accounts for over 17% of total nonfarm employment. As Census hiring winds down, we expect the private sector to continue the trend of this recovery, adding many more jobs than government. It's clear that those who claim recent job growth is all from government hiring aren't seeing the whole picture.
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
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