While Washington legislators debate what role the government should play in job creation this year, the government itself is poised to go on a major hiring spree this spring.
That is because of the granddaddy of all government programs – the census, a house-by-house head count of the population conducted every 10 years since 1790. The Census Bureau is starting to hire 1.4 million people to man offices and go door to door collecting information about everything from household income to health status.
The beginning of the Census Bureau’s massive but temporary hiring binge was evident in the Labor Department’s report released Friday that showed federal employment expanded by 33,000 in January, including the addition of 9,000 census workers. But economists say that trickle of jobs will turn into a gusher in the months ahead.
Harm Bandholz, an economist with Unicredit Markets, said he expects census hiring to ramp up to 50,000 this month and then spike. The Census Bureau is expected to add about 1 million temporary workers between March and May.
“This employment will provide a necessary short-term boost to the job market,” even though the jobs are mostly part time and will end later in the year, said Sung Won Sohn, an economics professor at California State University at Channel Islands.
“The federal government is contributing to job gains,” he said.
Census-fueled job growth is likely to be welcome news for the 8.4 million people out of work as a result of the recession, according to the Labor Departments latest count. The nation has not seen a sustained increase in employment after more than two years of persistent and painful job losses each month.
Census officials report that people have been lining up to grab positions when they come available, particularly in neighborhoods with high unemployment.
“At this time, in the recession we are all going through, these jobs are valued by the population,” said Robert Groves, the bureaus director. “The hiring process that were going through reaches out to unemployed people disproportionately.”
Mr. Groves said the high unemployment rate has provided the bureau with many highly qualified applicants to man the census. He said the bureau has received about three applications for every job available.
As welcome as it is for job seekers, the spurt of census hiring will present some problems to economists as they try to discern the underlying hiring trend in the economy. Private businesses – not government entities – normally do the vast majority of hiring.
Whether and when businesses start creating jobs again will be critical questions, both for politicians in an election year and for the economy as a whole. Economists say the growth that was kick-started by government incentive programs in the middle of last year will not continue unless private businesses take up the baton this year and start to expand production and hiring.
John Canally, an economist at LPL Financial, said the surge in government census jobs in coming months is likely to add to confusion about the job market and cloud the picture for investors, consumers and businesses searching for evidence that an economic recovery is taking hold. He expects the Labor Department to provide an estimate each month of the number of jobs created or lost, excluding census jobs.
“The market will want to look at the numbers ‘ex-census,’ and continue to do so for most of 2010,” he said.
The broader job market is showing signs of steady – if glacially paced – improvement. Fridays jobs report showed that the unemployment rate dropped unexpectedly from 10 percent in December to 9.7 percent last month and that layoffs slowed significantly.
After 2009 started out with employers laying off nearly 800,000 a month in the worst job bloodletting since the Great Depression, the losses slowed steadily to about 35,000 a month since November.
Perhaps the most encouraging surprise last month was the return of manufacturing jobs. After shedding more than 2 million jobs in the past three years, the hard-hit sector eked out a gain of 11,000 jobs in January. That reflected the revival of production after a horrific year for U.S. automakers, in which two out of three went bankrupt and shut down facilities for large portions of the year.
Retailers added 42,000 jobs in January, their first gains since the recession began in December 2007. That reflected a moderate revival in consumer spending since the fall that handed retailers a mildly better Christmas season, as well as the best January sales in years.
Health and education jobs continued to grow, as they have throughout the recession.
But the development that showed the most promise to economists was a gain in temporary jobs of 52,000 – a record for January. That, along with other “good omens” in the report, like upticks in work hours and wages, convinced many analysts that a revival of job growth may be just around the corner.
“The bottom for employment is close at hand,” said Nigel Gault, chief U.S. economist at IHS Global Insight. “The jobs report suggests that the economy is on the verge of creating jobs.”
But he cautioned that job gains are likely to start gradually – not enough to satisfy the army of more than 16 million people looking for work.
“The welcome drop in the unemployment rate can’t yet be taken as the start of a trend,” he said. Economists expect the unemployment rate to tick up again later this year as Americans surge back into the job market to chase the trickle of positions that become available.
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