The Americans That Jobs Can't Find?

Last week's payroll number of 138,000 was below consensus expectations. My initial reaction was, "so what?" First, I generally don't like using "consensus estimates" as a benchmark. Secondly, employment numbers tend to be lumpy, and thirdly, statistical seasonal adjustments just as often distort the picture as they do correct for distortions. But the reaction to this number has been interesting. There is the typical reaction that you find in most mainstream economic analyses and the MSM, which is that the economy itself is slowing down and thus creating less jobs. No surprise there. However, an alternative hypothesis is emanating from some quarters that perhaps the employment numbers, starting with this one, are beginning to show that the robust economy is bumping up against the ceiling of labor resource constraints. In English, that means employers can't find enough workers (or capable workers) to do all the work that they wish to have done. The evidence for this is far from overwhelming, but there is definitely something to it as a decent hypothesis. The work week is creeping up indicating that employers might be giving their current workers more hours given the inability to find qualified workers to accommodate growth. In addition, productivity gains keeping coming at us like the Energizer Bunny, implying that employers continue to pursue productivity enhancing investments to stretch the capacity of existing workforces.

If this hypothesis is indeed what is going on, it has many economic implications, but I think one of the most notable implications is that it would make the immigration debate platitude "immigrants do the jobs that Americans won't do" not merely silly, but 180 degrees from reality - immigrants are filling jobs that can't seem to find an American.