The Edmond Sun

September 23, 2013

Economist sees more jobs for next year

James Coburn
The Edmond Sun

EDMOND — The U.S. is expected to regain it’s peak employment status by the end of 2014, said Russell Evans, executive director of the Steven C. Agee Economic Research and Policy Institute.

He estimated that 138.8 million payroll jobs will surpass the 138.3 million payroll jobs that occurred early in 2007. All the jobs that were lost by the recession will be replaced, Evans said before the Edmond Economic Development Authority’s 4o’clock 4cast event last week.

Department of Labor statistics indicate that 169,000 new jobs were created in August and the unemployment rate dropped to 7.3 percent. This figure does not include people who have given up looking for employment, or those who have expired unemployment benefits.

“If you were going to adjust your payroll size for growth in the population and growth in the labor force, we won’t have accounted for all of the recessionary job losses until probably 2016 or 2017,” Evans said.

The year will close with an average 150,000 to 160,000 jobs added each month, Evans said. Monthly averages of 180,000 to 190,000 new payroll jobs will complete next year, he said.

“We need 150,000 to 225,000 just to keep up with the normal growth of the labor force,” Evans said. “And so until we get numbers that are really above 200,000, and you’re really above 250,000 consecutively for many months, you’re not going to see a big turn around in the labor market.”

Prices rise when consumers spend money against a constrained production market, Evans said. Banks hold $1.8 trillion of excess reserves. It is too simplistic for the Federal Reserve to put $1.8 trillion on the balance sheets of banks and consider it separate from the impact of the money supply on pricing, he said.

“I think it’s overly simplistic because your goals fit two nice categories … that therefore there is nothing to worry about,” he said. “The Federal Reserve will tell you there is nothing to worry about. But a lot of people that I visit with are concerned about the size.”

Evans said he believes inflation can be avoided if more focus in placed on the reduction of the U.S. debt. A Goldcore report Monday listed the national debt at $16.95 trillion. The current U.S. debt has been reduced by $1.4 trillion in 2009 to $650 billion during this fiscal year. Budget deficits were less that $400 billion before the U.S. war in Iraq and the campaign in Afghanistan. | 341-2121