Unemployment Rate Drops By 0.1% In February

The Labor Department has released its employment figures for February, and they show the unemployment rate dropped by 0.1% from 4.8% in January to 4.7% in February. The economy produced 235,000 new jobs, but the civilian work force also grew -- keeping the unemployment rate in the 4.7% to 5% range it's been in for over a year now.

To be fair, Donald Trump hasn't been president long enough to have a real effect on unemployment, and hasn't initiated any policies that would effect it. But he has promised to create huge numbers of new jobs. Unfortunately, that probably won't happen since he clings to the failed "trickle-down" economic theory.

The only real solution to creating more jobs is to give corporations more money through huge tax cuts. There are some problems with that plan. First, the corporations already have trillions of dollars in the bank (a record amount), and they are not using it to create massive amounts of new jobs.

Second, tax policy has nothing to do with job creation. There have been times of healthy job creation under high taxes (Roosevelt, Truman, Johnson Carter administrations) and times of anemic job creation under very low taxes (Bush I and Bush II administrations).  The chart below illustrates that. It is just a fact that high taxes do not hurt job creation and low taxes don't spur job creation.

Only one thing creates new jobs -- a significant rise in the demand for goods and services. The two easiest ways to increase demand is to raise the minimum wage (which would put upward pressure on all wages) and for the government to pump more money into the economy (by increasing its help for the poor and disadvantaged). Unfortunately, Trump has said that wages are already too high, and has indicated that he plans to cut all domestic programs except the military (which would take huge amounts out of the economy -- decreasing demand).

If Trump follows through on the policies he has proposed, we are more likely to see unemployment to start creeping upwards than to go down.

Here are the relevant statistics for February:

DEMOGRAPHIC BREAKDOWN OF UNEMPLOYMENT RATE:

Adult men...............4.3%
Adult women...............4.3%
Teenagers (16-19)...............15.0%
Whites...............4.1%
Blacks...............8.1%
Hispanics...............5.6%
Asians...............3.4%
Less than HS diploma...............7.9%
High School diploma...............5.0%
Some college...............4.0%
Bachelor's degree or more...............2.4%

SIZE OF THE CIVILIAN WORK FORCE:

160,056,000

OFFICIAL NUMBER OF UNEMPLOYED WORKERS:

7,528,000

OFFICIAL UNEMPLOYMENT RATE:

4.7%

NUMBER OF MARGINALLY-ATTACHED WORKERS (no longer counted):

1,723,000

MORE REALISTIC UNEMPLOYMENT RATE (official + marginally-attached):

9,251,000

MORE REALISTIC UNEMPLOYMENT RATE:

5.78%

NUMBER OF UNDEREMPLOYED WORKERS (working part-time because they can't find full-time job):

5,704,000