Economists never seem too bothered by the realities of what they study.
To most of us, the purpose of an economy is to facilitate commerce and create jobs. So it follows that a recovery should include increases in employment.
However, we continue to hear that this may be a “jobless recovery.”
The latest poll from the NFIB suggests that any recovery including jobs is still not in sight.
In September, small business owners reported a decline in average employment of 0.83 workers per firm during the prior three months, a substantial improvement from May but virtually no change from July and August and historically the sixth largest loss per firm in the 35 year survey history (the record is negative 1.26 in May, 2009).
Only seven percent of the owners increased employment and 23 percent reduced employment, yielding a seasonally adjusted net negative 16 percent of owners decreasing employment in the last three months, unchanged from August. The job generating machine is still in reverse. Sales are not picking up, so survival requires continuous attention to costs, and labor costs loom large.
This is not a recovery to those of us who care about small businesses on main street.