Stocks in the United States are falling today, on the first trading day since the Labor Department announced Friday that employers added 120,000 jobs in March. That's only half of the 240,000 added in February, and way below the expected estimate of around 200,000. The unemployment rate did fall to 8.2%, but that's mainly attributed to decreasing labor force. The CNN report states that "job growth of around 120,000 is just about enough to keep up with population growth." Given the average rate of population growth in the United States, what exactly is the amount of job growth over month just to keep the same employment rate?
From the US Census Bureau data from 2000 to 2010, we can calculate the average monthly population growth rate. Then taking the current US population, we can estimate the monthly population increase:
- 308,745,538 = 281,421,906*(1+r)^120
- r = 7.724e-4
- Δpopulation = 313,332,804*7.724e-4 = 242018.258
Now we need figures on the labor force:
- 142,034K employed in March 2012
- 142,034K / 313,332,804 = 45.33% of population employed
At last, Δpopulation * (% of population employed) = 242018.258 * 45.33% = 109,706.876. This means that nearly 110,000 jobs need to be added each month just to accommodate the rising population and keep the unemployment rate steady. Given this number, it's plausible to claim that the jobs added in March barely offset the population increase.
Sources:
