Obama Has Swapped Manufacturing for Service Sector Jobs (Audio)

In his review of the latest economic data, Peter Schiff rips more holes in the economic “recovery” narrative. The labor-force participation rate just hit its lowest level since 1977. Meanwhile, under Obama’s presidency, 1.4 million manufacturing jobs have been lost, while 1.4 million bartending, waitress, and waitering jobs have been created.

Highlights from the podcast:

“Once again, [the non-farm payroll report] is the most anticipated economic release of the month. The consensus forecast was for 230,000 jobs created. The actual number ended up being 223,000. So just 7,000 light. Not a really bad report. The unemployment rate, which was 5.5% last month was expected to come in at 5.4%, and it came in at 5.3%. This is the lowest unemployment rate in seven years. It’s certainly the lowest unemployment rate since President Obama has been President. ‘Oh this is great news!’ Right? Uh-uh. Not great news.

“First of all, they ended up revising down the prior two months by about 60,000 jobs. Remember the 280,000 jobs that they reported for May? Now they revised that down to just 254,000, so not nearly as strong as they initially report.

“But the devil, again, is always in the details. The worst detail, I think, was the labor force participation rate. That was 62.9 last month. This month it plunged all the way down to 62.6. This is a new low. It has never hit 62.6 since 1977. That’s the middle of the disco craze. I was in high school. In fact, I think I was still in junior high school…

“According to the government, 442,000 people dropped out of the labor force in June. That’s about twice the number of people who got jobs in June. Once again, these are low-paying jobs. These are service sector jobs. In fact, I saw a statistic up on ZeroHedge today that mentioned during the entirety of the Obama recovery, we have lost 1.4 million manufacture jobs, and we have gained 1.4 million waitress, waiter, and bartending jobs. Great trade. That is what is going on.

“But you know, the household survey was even worse. According to the household survey, 640,000 Americans left the labor force in June. Now we have a record 93.6 million Americans no longer in the labor force. Also, the household survey reported 349,000 full-time jobs were lost during the month. The only gains were in the part time. We gained 161,000 part-time jobs. Of course, the difference is still a net loss. So according to the household survey, we lost jobs. What was important was that we lost the good paying jobs and we created the lower paying jobs…

“The Secretary of Labor Perez… was specifically asked, ‘Are you concerned about this big drop in the labor force participation rate?’ This is what he said. I’m not making this up. He said, ‘One month does not a trend make. I’m not worried about it because I’m not worried about one month.’ Well, this is not a one month phenomenon. The labor force participation rate has been going down steadily almost every month, every year that President Obama has been in office…

“When Janet Yellen gave her press conference following the most dovish meeting that we’ve had recently when the Fed didn’t raise rates – Steve Liesman specifically asked Janet Yellen a question, ‘What do we have to see in the labor market before you raise rates?’ Very specific. Her answer was specific. She said, and I’m almost quoting verbatim, before the Fed can start raising rates – start – she wants to see further improvement in the labor market. at the time, I said, ‘What does she mean? Unemployment is at 5.4%. We’ve been creating 200,000 jobs a month. What more improvement does she want?’ Well, she was specific. She addressed two concerns that she had. One was the labor force participation rate… Too many people had left the labor force, and so she wants to see them coming back in. She also mentioned the proliferation of people working part time who really want to work full time…

“Based on this data, we’ve just moved a lot further from her goal. The labor force participation rate has never been lower. And we’re creating all kinds of part-time jobs and we’re losing full-time jobs. So we’re moving away from the Fed’s goal…”

“The jobs numbers were not the only economic number of the day. Another important number was factory orders. Factory orders have actually been down for 8 of the last 9 months. Except, now that we’ve gotten May’s number, we’re down 9 out of the last 10 months. They were looking for minus 0.3% for factory orders for May. Instead of minus 0.3, we got minus 1% even. Big drop. More than three times the estimate. But it gets worse, because April was originally reported as minus 0.4… Instead, they revised April down to minus 0.7. So we actually fell 1% from a downwardly revised 0.7%. So it is a disaster for factory orders… This is the biggest year-over-year drop since the 2008 financial crisis, and we haven’t even had a financial crisis!”

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