The latest weak numbers could signal more economic instability. What impact will that have on your business?
Despite analysts’ predictions of significant job growth, December wasn’t a great month for the unemployed. Only 74,000 jobs were added to public and private payrolls, the Bureau of Labor Statistics (BLS) announced today. Analysts had estimated a median of 197,000 added jobs, according to a Bloomberg study, so the BLS’s low numbers came as something of a surprise.
The unemployment rate sunk to 6.7%, the lowest unemployment has been since 2008. Under normal economic circumstances, this would be a cause for celebration. But many signs point to unemployment frustration: those who have been looking for work have now dropped out of the job market entirely. The BLS classified 917,000 people as “discouraged workers,” while 10.4 million Americans are still unemployed and searching for work.
“As our economy continues to make progress, there’s a lot more work to do,” Jason Furman, chairman of the president’s Council of Economic Advisers, said in a White House statement. “Today’s numbers are a reminder of the work that remains.”
One of the main challenges facing the Obama administration is the issue of unemployment insurance. Congress allowed extended employment insurance legislation to lapse at the end of 2013, which gave way to a nerve-wracking start to the new year for many of the long-term unemployed.
All these elements combined are enough to turn the job search into a nail-biter. But experts caution against reading too much into the data, which may have been skewed by unusually harsh winter weather across the country. Standard “seasonal adjustments” to the data may not be enough to compensate for many days of inclement weather.
Additionally, the BLS revises previous months’ data based on more accurate information as it becomes available. So numbers that today look particularly dire may shift with newly emerging information.
Here at The Story Exchange, we track the rise of female-run small businesses. What impact will continued economic instability have on small business? Is it too much to hope that discouraged workers may turn their situations into opportunities for entrepreneurship? We welcome your comments.