Commentary: Job growth, while not strong, isn’t recessionary either

WASHINGTON (MarketWatch) — The U.S. economy performed a lot better during the summer
than most people expected, but it didn’t do nearly well enough.
 
Remember back in late July and early August, when the Dow industrials was crashing
and Standard &amp; Poor‘s slapped the government around and everyone feared that the
economy would crash into a recession? It didn’t happen ... the recession part, that
is.
 
Job growth was not spectacular in the third quarter, by any means. But it didn’t
collapse, either, as so many feared. After a gain of 103,000 in September and upward
revisions in July and August, the Bureau of Labor Statistics reported Friday that the
economy created an average of 96,000 jobs per month in the quarter, little changed
from the 97,000 average in the second quarter (but down sharply from 166,000 in the
first quarter).     See our complete coverage of September’s job growth.
 
Unfortunately, the job growth is less than the 125,000 or so we need just to keep
pace with population growth. And it’s far less than the 200,000 or 300,000 needed to
make a dent in the unemployment rate and to bring discouraged would-be workers back
into the work place.
 
There are some hopeful signs in the jobs data, but it’s too early to tell if they
represent new trends or just meaningless statistical noise. Some background first:
The jobs report comes from two separate surveys: One is of 440,000 work places and is
used to derive the growth in payrolls and data on hours worked and average pay. The
other survey is of 60,000 households and is used to derive the unemployment rate and
other demographic data.
 
The household survey reports that employment rose by 398,000 in September after
gaining 331,000 in August. What’s more, the labor participation rate has risen two
months in a row, hitting 64.2% in September after falling almost every month since
the recession began nearly four years ago.
 
These are some of the best numbers in years, but economists don’t put much stock in
them because the household survey isn’t quite as reliable as the payrolls survey.
Still, it’s worth watching those numbers in coming months.