Census Jobs May Jump-Start U.S. Employment Rebound in 2010
The 2010 census couldn’t have come at a better time for the U.S. economy.
The government will hire about 1.2 million temporary workers in the first half of the year to administer the decennial population count, possibly providing a bridge to gains in private employment later in the year.
The surge will probably dwarf any hiring by private employers early in 2010 as companies delay adding staff until they are convinced the economic recovery will be sustained. Money earned by the clipboard-toting workers going door-to-door to verify the government population survey is likely to be spent, giving the economy an extra lift.
“It’s a short-term stimulus program in which the government’s injecting money into the economy through additional paychecks,” said Dean Maki, chief U.S. economist at Barclays Capital Inc. in New York, who projects that 2.5 million more Americans will be working at the end of the year. “This will support consumer income during those months.”
Payrolls unexpectedly fell 85,000 last month, a Labor Department report showed today, and revisions showed they increased by 4,000 in November, the first gain in almost two years. Service industries, which include banks, insurance companies, restaurants and retailers, subtracted 4,000 workers after adding 62,000 the previous month.
The economy will add 1.1 million jobs by the end of the year, according to the consensus estimate in a survey last month by Blue Chip Economic Indicators.
“We have the strongest increases in the second half of the year,” said Nigel Gault, chief U.S. economist at IHS Global Insight in Lexington, Massachusetts, referring to the firm’s forecast for hiring to grow by 800,000 this year.
Third Quarter
Economists’ payroll estimates for the year exclude the census numbers since the jobs created are temporary, with most disappearing by the end of the third quarter and the rest gone by December.
The stimulus bill President Barack Obama signed in February and additional funding by Congress provided enough money to hire 1.4 million Americans in total for the census, almost three times as many as in 2000 easy online payday loans. About 160,000 were already employed last year to do preliminary work.
The Census Bureau anticipates hiring about 181,000 workers from January through March and about 971,000 in the following three months.
First Five Months
The economy may add about 700,000 jobs in May alone, mostly because of the census, Gault said. Even Maki’s more optimistic assessment of the employment outlook means the U.S. may take years to recover the 7.2 million jobs lost since the recession began in December 2007.
“The bulk of these employees are from the low end of the income distribution; they are cash-constrained,” said Neal Soss, chief economist at Credit Suisse in New York who forecasts the economy will add a little more than 1 million jobs this year. “Having a paycheck is allowing them to spend in a way that they wouldn’t otherwise.”
Hiring for the census may also help lower the unemployment rate early this year, economists said, though the influence will be less than in payrolls. For example, some of the people hired may have other part-time jobs, limiting the impact on joblessness.
By the end of the year the jobless rate will fall to 9.7 percent, according to the median estimate of economists surveyed by Bloomberg News. The unemployment in December held at 10 percent.
Optimistic Outlook
Bruce Kasman, chief economist at JPMorgan Chase & Co. in New York, is among those optimistic about the outlook for jobs early in the year with or without the help from the census.
“We think it’s going to ramp up pretty quickly,” he said. Kasman forecasts the economy will create more than 2 million jobs this year.
Other economists anticipate a labor market weakness will persist through the next six months, even taking into account the census hiring.
“The labor market will effectively be stalled through the first half of 2010,” said James Shugg, a senior economist at Westpac Banking Corp. in London.