The better-than-expected June job gains reported last week
raise a pointed question: Why are businesses hiring so many workers in a
weakening economy?
Employers added 195,000 jobs in June
and a monthly average of about 200,000 so far this year, according to a
Labor Department survey of establishments. That's up from 183,000 in
2012 and on pace for the strongest annual payroll increases in the
four-year-old recovery.
Meanwhile, the government recently cut
its estimate of the economy's first-quarter growth to a tepid 1.8%
annual rate from 2.4%. Measures of manufacturing and service-sector
activity have dipped in recent months amid federal budget cuts and
economic troubles overseas. Corporate sales and profits have risen only
modestly this year.
Many economists expect even more anemic
growth in the second quarter — 1% to 1.5%. Typically, economic growth of
more than 3% is needed to generate 200,000 jobs each month.
One
explanation is that the employment picture isn't as rosy as it seems.
Many of the jobs created recently have been low-wage, part-time slots in
industries such as...Read more on usatoday »»»
