Associated Press reports:
One sign of better economic times is when more people start finding jobs. Another is when they feel confident enough to quit them.David Leonhardt writes on the government's failure to help support aggregate demand:
More people quit their jobs in the past three months than were laid off -- a sharp reversal after 15 straight months in which layoffs exceeded voluntary departures. The trend suggests the job market is finally thawing.
Some of the quitters are leaving for new jobs. Others have no firm offers. But their newfound confidence about landing work is itself evidence of more hiring and a strengthening economy.
"There is a century's worth of evidence that bears out this view that quits rise and layoffs fall as the job market improves," said Steven Davis, an economist at the University of Chicago.
Still, the number of people quitting their jobs is nowhere near what it was before the recession. Economists expect the improvement in the job market to be fitful, rather than consistent. In May, for example, private employers added only 41,000 net jobs after adding 218,000 in April.
Yet the long-term trend points to an improving job market. The economy has created a net 982,000 jobs this year after a recession that wiped out more than 8 million of them.
Despite all this, there is reason to think that more stimulus may finally be on the way. Last Friday’s jobs report showed little private-sector job growth in May, which was a good reminder that recoveries from financial crises are usually rocky. The report has the potential to persuade Congress to expand the jobs bill passed by the House, which is now before the Senate.Blanche Lincoln won the primary in Arkansas probably because of the Obama administration's stimulus bill and the jobs it created. How well the Democrats fair in November will be in large part determined on how well the economy creates jobs during the remainder of the year. Presumably their fund-raising efforts will be helped by tough talk on deficits, but who knows for sure?
As is, the House bill would cut taxes for businesses and temporarily extend jobless benefits, among other things. By the end of the year, it would add about 170,000 jobs, Moody’s Economy.com estimates. Expanding the bill to include extra Medicaid funds for states -- which seems politically conceivable -- could add 100,000 more jobs. Expanding it to keep teachers employed -- which is unlikely -- could add 200,000 or so.
Will another half-million jobs make the economy feel strong again? No. Will the next round of stimulus be more popular than the last one? Probably not.
Is it nonetheless the right thing to do? That’s another question entirely.
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