Employers added 178,000 jobs last month, while the unemployment dropped to 4.6%—dangerously close to the “full employment” level that mainstream economists warn could trigger wage and price inflation. The only fly in this ointment: the November numbers insure a Fed interest rate hike later this month, and further hikes in 2017 to cool off what DC-based economists see as an overheating economy.
The Main Stream Media couldn’t contain its euphoria:
In the book of United States economic history, the November jobs numbers released on Friday would make a fitting end to a particularly long, terrifying chapter that began nine years ago.The NYT’s Neil Irwin [Email him] is right—November (hopefully) will mark the end of a long and terrifying era in U.S. economic history. But that era dates from 1965, when the Immigration and Nationality Act Amendments enabled mass immigration from non-traditional source countries. While the initial impact of that change was imperceptible, it gathered steam in the 1980s, and crested in the George W. Bush and Barack Obama years.
The New Jobs Numbers Signal the End of an Economic Era, by Neil Irwin, New York Times, December 2, 2016
The damage done by the 1965 immigration legislation resonates loud and clear in the latest Household Survey employment figures (which count legal and illegal immigrants together).
This is brought out in our New VDARE.com American Worker Displacement Index (NVDAWDI) graphic:
Native-born American employment growth is represented by the black line, immigrant employment growth is in pink, and NVAWDI—the ratio of immigrant to native-born job growth—is in yellow. The index starts at 100.0 in January 2009 for both immigrants and native-born Americans, and tracks their employment growth since then.
From January 2009 through November 2016:
The key variable in the displacement story is the foreign-born share of total U.S. employment. This has risen steadily, albeit erratically, throughout the Obama years:
In February 2009, Barack Obama’s first full month in office, 14.972% of all persons working in the U.S. were foreign-born. In November 17.191% of workers were foreign-born—the third highest among the 95 months of the Obama era.
The Obama era high was set in August 2016, when 17.216% of persons working in this country were immigrants.
Seven of the 10 worst months for native-born American workers during the Obama years (measured by the share of jobs held by immigrants) have occurred in 2016.
The foreign-born share of total employment in November was 2.22 percentage points above the level recorded in February 2009. With total employment now at 152.1 million, this implies that Obama-era immigration may have pushed as many as 3.35 million native-born Americans onto the unemployment rolls since then.
That last factoid deserves some thought, coming at a time when Donald Trump is basking in the glow of those 1,000 Carrier jobs he saved in Indiana.
The unemployment problem in middle America is simply too big to be addressed by ad hoc measures. Only quantum changes in U.S. economic policy, a list that includes deportation, a wall, and renegotiating NAFTA, can fully address this problem,
A detailed snapshot of American worker displacement over the past year is seen in the Employment Status of the Civilian Population by nativity table published in the monthly BLS Report.
Employment Status by Nativity, Nov.2015-Nov. 2016
|(numbers in 1000s; not seasonally adjusted)|
|Foreign born, 16 years and older|
|Civilian labor force||26,665||27,384||719||2.7%|
|Participation rate (%)||66.1||65.4||-0.7%pts.||-1.1%|
|Unemployment rate (%)||4.4||4.3||-0.1%pts.||-2.3%|
|Not in labor force||13,688||14,514||826||6.0%|
|Native born, 16 years and older|
|Civilian labor force||130,675||132,068||1,393||1.1%|
|Participation rate (%)||61.8||62.1||-0.3%pts.||0.5%|
|Unemployment rate (%)||4.9||4.5||-0.4%pts.||-8.2%|
|Not in labor force||80,720||80,575||-145||-0.2%|
|Source: BLS, The Employment Situation— November 2016, Table A-7, December 4, 2016. PDF|
Over the last 12 months (November 2015 to November 2016):
Once again the population numbers give us pause. BLS estimates that the number of working age immigrants rose 1.545 million in the past 12 months. That is larger than the commonly cited figure for net legal immigration of all ages of 1 million per year.
Historically strong job growth in the U.S. usually portends higher immigration rates—both legal and illegal.
But that was BT (Before Trump). We expect better from President Trump.