The Department of Labor today reported that the U.S. economy created 169,000 jobs last month and the unemployment rate fell from 7.4 percent to 7.3 percent.
But the news is really not so great.
Part of the reason for the slight drop in unemployment was that the civilian labor force participation rate declined a bit. At 63.2 percent, it’s the lowest rate in 35 years, according to the Wall Street Journal.
And 169,000 jobs is slightly below expectations and will do little to drive down unemployment. The economy needs to add about 150,000 jobs a month just to keep pace with the normal growth in the workforce. According to the left-leaning Brookings Institution, for the economy to make up the jobs lost to the recession in four years, it would have to create about 300,000 jobs a month.
What’s more, the DOL revised down the jobs gains for June and July, putting the average growth over those two months to 134,000 each month:
The change in total nonfarm payroll employment for June was revised from +188,000 to +172,000, and the change for July was revised from +162,000 to +104,000. With these revisions, employment gains in June and July combined were 74,000 less than previously reported.
None of this is a sign that the recovery is picking up much steam.