The Summer of Slog

This is how the summer ends. Not with a bump, but a whimper.

The official unemployment rate for the month of August ticked up to 9.6 percent, as the economy lost 54,000 jobs total, even though it added nearly 70,000 in the private sector. Daniel Indiviglio has a great write-up of the report with illuminating graphs.

The first week of September gives us a good opportunity to step back and think about the entire summer in jobs. It's a pretty consistent story. In August:

-- Overall jobs declined, as they have all summer.
-- That's because we lost temporary Census jobs, as we have all summer.
-- We also lost state and local jobs, as we have all summer.
-- Private sector jobs went up a little, as they have all summer.
-- Health care led the way in private sector job creation, as it has all summer. 
-- Discouraged workers are still over a million, as they've been all summer.
-- The unemployment rate stayed over 9.5%, where it's been since the summer ... of 2009.

As David Leonhardt sums up, this year's summer shakes are coming from a few places: the European debt markets are spooking investors, unsteady recovery numbers are making American companies nervous, and penny-pinching consumers are paying debt down and savings up.

The big story to keep our eyes on is private sector job creation, which peaked in April and May. In the last four months, we've created about 70,000 jobs per month in the private sector. That's a little more than half what we need to keep up with the number of people who typically enter the labor force each month.

How many jobs must we create a month to get on the road to restoring full employment? This graph from the Hamilton Project makes a sobering point. If every twelve months, we added as many jobs as the best year in the last decade, we wouldn't get back to full employment for another eleven years.