Last week, two separate sets of employment data were released. One showed that the U.S. economy had added 244,000 jobs in April. The other reported that the unemployment rate had increased from 8.8 to 9 percent.
As news analysts took pains to explain, although the two indicators frequently move in opposite directions more new jobs means lower unemployment that doesnt have to be the case. According to the Wall Street Journal, the jobs report comes from a survey of establishment payrolls, while the unemployment numbers come from a survey of households i.e. employers on one hand, the employment pool on the other.
When the results of the household survey were adjusted to compare apples to apples, that figure showed a gain of 50,000 jobs which sounds like good news but actually means the job loss among non-establishment jobs is even worse than it initially appeared.
Any increase, anywhere, is good news, but a true picture of employment requires a mosaic of various snapshots, and that mosaic can be difficult for the average American to assemble from news reports about the monthly release of economic indicators, those numbers that seem to send the stock market up or down.
In the more populous areas of the country, establishment payrolls by major employees are very closely related to job opportunities. In rural areas, most economic opportunity lies outside the establishment. Entrepreneurs dont show up in the establishment report, and although startups always have a low survival rate, they can be a good indicator of economic optimism in a small town. Individuals who are self-employed or work in family businesses arent counted; neither is anyone who works in non-corporate agriculture. Those businesses are not susceptible to the swings of the stock market; instead, they depend on the overall health of the economy.
In Southwest Colorado, establishment payrolls mainly reflect government jobs and chain retailers. Sure, some of our statistics are aggregated in other ways, but even in total the numbers are so small that rural communities are simply almost invisible to those who watch trends in the national economy. Those that were once manufacturing towns show up when their plants close, and ag regions become relevant at harvest time and during natural disasters like floods that reduce ag yields sufficiently to change commodities markets.
To a great extent, though, when the rest of the nation is beginning to recover, people who dwell in cities and on the coasts (that is, most people and most policymakers) may not notice that their rural counterparts arent keeping pace.
The ongoing struggle is not in anyones imagination; its just not on the radar screen in Washington and on Wall Street. Help wasnt likely to come from those sources anyway, but it never hurts to ask elected officials, Look up from the numbers and see whats happening in the real world.
