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New numbers released today by the Bureau of Labor Statistics show that employment fell by 17,000 jobs in January, 2008. Employment growth has been relatively low for several years, but this month’s figures marked the first time since August 2003 that the economy actually lost jobs. January’s employment figures are the latest sign of a weakening economy and indicate that 2008 will be a tough year for workers.
Just as significantly, employment figures were revised downward for the previous year; the economy created 280,000 fewer jobs in 2007 than had been previously estimated. According to the new numbers, the economy added a meager 1.1 million jobs in 2007, and job growth was less than one percent. By contrast, the economy in the late 1990s was adding 3 million jobs per year and job growth was over 2.5 percent. Even in 2006, a relatively weak year for employment, job growth was 1.6 percent and the economy added 2.1 million jobs—over a million more jobs than were added in 2007.
New unemployment figures for January also show worrisome results. Unemployment fell slightly in January to 4.9 percent from 5.0, which suggests that fewer people are actively looking for work because of the poor state of the economy. The average length a person remained unemployed increased to 17.5 weeks, up nearly a week since December 2007. And average weekly earnings fell by $0.42 in seasonally adjusted terms during the same period.
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Senior Fellow; Senior Adviser, American Worker Project