According to the mainstream narrative, we were all born yesterday. There is no such thing as context, history or critical analysis—just cherry-picked short-term data-deltas, which are held to be either awesome or at least much improved from last time.
That’s why we predictably got this headline from the Wall Street Journal with reference to today’s June employment release, which allegedly showed “employers added 850,000 jobs last month”:
Well, no, it wasn’t and they (employers) didn’t. In fact, total hours worked in June actually declined from the May level, and, far more importantly, were still down 4.4% from the pre-Covid peak in February 2020.
When expressed in total hours, there is absolutely nothing “strong” at all about the numbers. To wit, at the end of Q2 2021 total hours employed in the nonfarm economy were still down 8 billion hours from the Q4 2019 level.
That’s right. Eight billion worker hours are MIA, yet the lazy shills at the WSJ, Bloomberg, Reuters et. al. keep pumping out bilge about an awesome economic rebound!
Actually, what has never been noted notwithstanding the fact that it sits there in plain sight on the BLS website is that Dr. Fauci and his economy wreckers dug a far deeper hole in the main street labor market last spring than the narrative led you to believe. At the pre-Covid peak in Q4 2019, the nonfarm economy utilized 257.2 billion labor hours at an annualized rate, but that plunged by nearly -12% to just 227.6 billion hours in Q2 2020.
So doing, Fauci & Co wiped out all of the aggregate nonfarm labor hours gain since Q4 2011. That is to say, it obliterated the awesome gains that had been contained in 102 monthly Jobs Friday reports in the interim. And now, after $4 trillion of freshly printed fiat cash and $6 trillion of stimmies and other bailouts and free stuff only 73% of the state-imposed shrinkage of hours worked has been recovered as of June 2021.
Indeed, the not-at-all awesome June jobs report was even more squirrely than usual. Our memory may fail, but we are quite sure that back in the day, June was the time when school let out. The city kids all got to got to go to the beach, and we farm kids got to pick the berries, cherries, sweetcorn, cucumbers, peaches and tomatoes, as they took their turn in rotation.
Perhaps, no longer. The BLS claims that state, local and private educational institutions went on a hiring binge during June, bringing on a total of 269,000 new teachers to superintend presumably empty classrooms!
Moreover, when you add in the 192,000 bartenders and waiters who were rehired in June, that adds up to 461,000 jobs or 54% of the ballyhooed 850,000 gain during the month.
Meanwhile, when it comes to the high pay, high productivity jobs in construction, manufacturing, mining and energy, not so much. Those sectors accounted for 23.338 million jobs in May and reported an increase of, well, 20k jobs in June. That’s a 0.0008 gain, if you have your HP 12c set to four decimal places.
More importantly, the 20.358 million goods producing jobs reported for June were still down by 780,000 from the pre-Covid peak in February 2020; and, on the more appropriate and accurate hour-based measurement, employment in the goods-producing sector truly remains mired in the dumps.
Thus, the index of aggregate hours worked for June (black line) was down by -6.4% from its 2019 interim high, and off by -21.1% from its turn of the century level, -23.1% from its all-time peak in March 1979 and down by -4.8% from the level first attained in, well, May 1947!
You can’t make this up. Employment in the goods-producing sector of the US economy has been dying on the vine for a half century. And even as these jobs paid a living wage of $56,000 per annum in the month of June, the purchasing power of those paychecks was no higher than January 1979 on an inflation-adjusted basis (purple line).
In summary, after real wages in the goods-producing sector doubled between 1947 and 1979, what has followed is one-half century of real wage stagnation, coupled with a 23% shrinkage of hours worked. That alone should ixnay the “strong” and “blow out” descriptions that have been used hundreds of times in the interim to describe the Jobs Friday reports.
Real Weekly Earnings Versus Aggregate Weekly Hours, Good-Producing Sector, 1947-2021
Then again, there is truly no mystery as to where the Fed’s endless injections of fiat credit have come out in the wash. For three decades, the nation’s central bank has been primarily inflating financial asset prices on Wall Street, not jobs, incomes and prosperity on main street. And that’s especially been the case since the pre-crisis peak in Q4 2007, when today’s $8.1 trillion Fed balance sheet stood at just $800 billion.