William from Denver, Colorado, asks: “Is there a way to show whether or not the private sector is actually ‘doing fine?’ In TV commercials I see that Mitt Romney is criticizing President Obama for saying that.”
Great minds can disagree about what constitutes “fine,” so let’s look at a firm measure of private sector health – the most recent jobs report. It didn’t contain a lot of good news, though there was perhaps one bright spot.
In May, the overall U.S. economy added 69,000 jobs. That was much lower than expected, and most analysts considered it an indication that our economic recovery is sputtering. It’s worth noting, however, that the private sector added 82,000 jobs in May, while the public sector – meaning government – shed 13,000 jobs as a result of budget cuts at federal, state, and local levels.
Eighty-two thousand new jobs in the private sector is better than 69,000, to be sure, but it’s still less than expected.
Meanwhile, there was a bright spot in the report that my colleague Chris Hellman unearthed in a recent blog post on unemployment. Though the economy didn’t add nearly as many jobs as we hoped, many people rejoined the labor force – meaning they started looking for work again. That may signal a glimmer of renewed confidence – though the private sector has yet to deliver new jobs to match. Government budget cuts make matters worse by adding more workers to the ranks of the unemployed.
Is the private sector doing fine? The economic recovery is disappointingly slow, though it’s inching in the right direction. Fine is probably too strong a word.