Non-Farm Payrollls: June Gloom

The June Non-farm payroll report gives more credence to the double-dip recession story. The BLS reported that a total of 125k people become unemployed last month. The only quasi-good news in the report was that 83k private sector jobs were created. Still far below the total needed to keep the unemployment rate from rising if job-seekers stay in the labor force. The bad news was that hours worked were down, earnings were down and the labor force shrank.

Average hourly earnings fell 2 cents to $22.53 in June, today's report showed. The average work week for all workers declined to 34.1 hours in June from 34.2 hours the prior month. And because people are becoming despondent in their search for employment, 652,000 people left the labor force last month.

The report from the BLS was not only disappointing on a headline basis, but digging into the report gives little support for better news in the coming months.

But all this makes perfect sense to me. Government spending and central bank money printing doesn't create jobs. Lower taxes, lower interest rates, increased savings, lowering inflation, reduced regulations, a stable currency and declining debt loads do. Those conditions are engendered when the government allows the free market to prosper. We are doing everything wrong.