The jobs report this morning suggests a clear trend of very modest growth in the U.S. labor market. This month’s gain of 171,000 jobs means we have now averaged 173,000 jobs per month since July. While this is above the 130,000 jobs per month needed to accommodate the growing population, it isn’t enough to indicate that the economy is in full recovery. At this rate of job growth, it will take more than a decade to get back to pre-recession employment levels.
As expected, the unemployment rate ticked back up to 7.9 percent. After reaching its lowest level in more than 30 years, labor force participation has now increased two months in a row to 63.8 percent. This remains well below its pre-recession level of 66 percent. Similarly, the employment ratio increased again this month but remains low at just 58.8 percent. This chart shows that we are still 10 million jobs below the employment ratio we had at the start of the recession.