18 Aug Will the Job Market Stall the Recovery?

With market indices rallying to all-time highs this summer, investors seem to be betting on a recovering U.S. economy. But more and more pundits are warning that the market may be over-hyping the still somewhat limited real growth in the economy.

The U.S. unemployment rate declined to 7.4% in July. Yet according to a recent ETF Daily News article, the percentage of Americans that are economically independent has dropped to a stunningly low level, while the percentage of Americans that are self-employed is at an all-time record low. Also, the percentage of Americans with a full-time job has declined to a level not seen in about 30 years.

There is a further concern that once Obamacare becomes fully implemented, employers will move more to part-time help to avoid paying for health coverage. These part time workers, in turn, look to federal entitlement programs to support them and become increasingly reliant on government aid.

There are many positives in our “jobless” recovery, in corporate profits, real estate and other areas. But small businesses continue to be the backbone of our economy providing the vast majority of all new jobs. Obamacare notwithstanding, we need to look for ways to encourage entrepreneurs to hire full time workers with benefits. This then stimulates consumer spending and will lead to greener economic pastures for all. Ideas?

Thanks to Eleazar Jacobs for assistance in this post.