The worse news:
There’s nothing good in this morning’s report. We had very low levels of job creation, wage growth isn’t budging, and the unemployment rate would have risen if the labor force participation rate hadn’t fallen.—Carl Tannenbaum, chief economist, Northern Trust in ChicagoTannenbaum was referring to the dismal employment numbers released on Friday. The economy added a mere 142,000 jobs in September, following an even weaker gain, of 136,000, after a downward revision, in August. The past two months rank as the worst back-to-back employment reports in the last three years.
Grim Jobs Report Is Likely to Delay a Move by the Fed on Rates, By Patricia Cohen, NYT, October 2, 2015
Like most financial sector economists, Tannenbaum was probably blindsided. A month ago, most of them saw the U.S. as a paragon of economic strength and stability in a world where others—China and the Eurozone, for example—were faltering. Janet Yellen failed to raise interest rates? Not to worry: The Fed chief simply wanted to alleviate the distress occurring in other places—not here.
That view took a hit on Friday.
The headline employment figures suggest that the economy is slowing. The “other” employment survey, of households rather than businesses, suggest that it is shrinking—and may already be in recession for native-born American workers:
Over the past two months native-born American employment has fallen by 374,000, or by 0.3%, while the number of immigrants at work has risen by 334,000, a gain of 1.4%.
American workers have lost ground to their foreign-born competitors throughout the Obama years. We highlight this trend in our New VDARE.com American Worker Displacement Index (NVDAWDI) graphic:
Native-born American employment growth is the black line, immigrant employment growth is in pink, and NVAWDI—the ratio of immigrant to native-born American job growth—is in yellow. The index starts at 100.0 for both immigrants and native-born Americans in January 2009, and tracks their employment growth since then.
From January 2009 to September 2015:
The foreign-born share of total U.S. employment has risen steadily, albeit erratically, throughout the Obama years:
In February 2009, President Obama’s first full month in office, 14.97% of all persons working in the U.S. were immigrants. In the latest month (September 2015) 16.73% of employed persons were immigrants. That’s up from 16.70% in August and 16.50% in July.
In only 10 of the 81 months of Obama’s Presidency have immigrant workers accounted for a greater share of U.S. employment than they did last month.
To put it another way: September’s immigrant employment share was 1.79 percentage points above the level recorded at the start of the Obama Administration.
With total employment at 148.8 million, each one percentage point rise in the foreign-born share translates to as many as 1.489 million displaced American workers. This means that Obama-era immigration may have pushed as many as 2.53 million (1.70 times 1.489 million) native-born Americans onto the unemployment rolls.
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, Sept. 2014- Sept. 2015
(numbers in 1000s; not seasonally adjusted)
|Foreign born, 16 years and older|
|Civilian labor force||26,238||26,132||-106||-0.4%|
|Participation rate (%)||65.8%||64.8%||-1.0%||-1.5%|
|Unemployment rate (%)||4.6%||4.6%||0.0%||0.0%|
|Not in labor force||13,622||14,182||560||4.1%|
|Native born, 16 years and older|
|Civilian labor force||129,666||130,475||809||0.6%|
|Participation rate (%)||62.2%||61.8%||-0.4%||-0.6%|
|Unemployment rate (%)||6.0%||4.9%||-1.1%||-18.3%|
|Not in labor force||78,921||80,536||1,615||2.0%|
|Source: BLS, The Employment Situation - September 2015, Table A-7, October 2, 2015. PDF|