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65–918 2011

S. HRG. 112–15 

THE EMPLOYMENT SITUATION: MARCH 2011 

HEARING 

BEFORE THE

JOINT ECONOMIC COMMITTEE 

CONGRESS OF THE UNITED STATES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

APRIL 1, 2011 

Printed for the use of the Joint Economic Committee 

( 

(II) 

JOINT ECONOMIC COMMITTEE 

[Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress] 

SENATE 

ROBERT P. CASEY, JR., Pennsylvania, 

Chairman-designate 

JEFF BINGAMAN, New Mexico 

AMY KLOBUCHAR, Minnesota 

JIM WEBB, Virginia 

MARK R. WARNER, Virginia, 

BERNARD SANDERS, Vermont 

JIM DEMINT, South Carolina 

DANIEL COATS, Indiana 

MIKE LEE, Utah 

PAT TOOMEY, Pennsylvania 

HOUSE OF REPRESENTATIVES 

KEVIN BRADY, Texas, Vice Chairmandesignate 

MICHAEL C. BURGESS, M.D., Texas 

JOHN CAMPBELL, California 

SEAN P. DUFFY, Wisconsin 

JUSTIN AMASH, Michigan 

MICK MULVANEY, South Carolina 

MAURICE D. HINCHEY, New York 

CAROLYN B. MALONEY, New York 

LORETTA SANCHEZ, California 

ELIJAH E. CUMMINGS, Maryland 

WILLIAM E. HANSEN, Executive Director 

ROBERT P. O’QUINN, Republican Staff Director 

(III) 

C O N T E N T S 

OPENING STATEMENT OF MEMBERS

Hon. Robert P. Casey, Jr., Chairman-designate, a U.S. Senator from Pennsylvania ...................................................................................................................... 1 

Hon. Kevin Brady, Vice Chairman-designate, a U.S. Representative from 

Texas ..................................................................................................................... 7 

WITNESSES

Dr. Keith Hall, Commissioner, Bureau of Labor Statistics; Dr. Michael 

Horrigan, Associate Commissioner for Prices and Living Conditions, Bureau 

of Labor Statistics; and Mr. Philip Rones, Deputy Commissioner, Bureau 

of Labor Statistics ................................................................................................ 3 

SUBMISSIONS FOR THE RECORD

Chart titled ‘‘Monthly Change in Private Payrolls’’ .............................................. 28 

Prepared statement of Dr. Keith Hall, Commissioner, Bureau of Labor Statistics, together with Press Release No. 11–0436 .................................................. 29 

Letter dated April 19, 2011, transmitting Commissioner Hall’s response to 

Representative Hinchey ....................................................................................... 68 

Prepared statement of Representative Kevin Brady ............................................ 71 

Chart titled ‘‘Labor Force Participation Rate’’ ...................................................... 72 

Chart titled ‘‘An Exceptionally Weak Employment Recovery’’ ............................ 73 

Chart titled ‘‘Private Sector Jobs Increase When Private Investment Increases’’ ................................................................................................................. 74 

Chart titled ‘‘Increased Federal Spending Has Not Led to Private Sector 

Job Creation’’ ........................................................................................................ 75 

Chart titled ‘‘Forecast vs. Reality’’ ......................................................................... 76 

Letter dated April 19, 2011, transmitting Commissioner Hall’s response to 

Senator Casey ....................................................................................................... 77 

Chart titled ‘‘GDP Grows for Sixth Consecutive Quarter’’ ................................... 79 

Prepared statement of Elijah E. Cummings .......................................................... 80 

Letter dated April 22, 2011, transmitting Commissioner Hall’s response to 

Representative Cummings .................................................................................. 81 

(1) 

THE EMPLOYMENT SITUATION: MARCH 2011 

FRIDAY, APRIL 1, 2011 

CONGRESS OF THE UNITED STATES, JOINT ECONOMIC COMMITTEE, Washington, DC. 

The committee met, persuant to call, at 9:32 a.m. in Room 106 

of the Dirksen Senate Office Building, the Honorable Robert P. 

Casey, Jr., Chairman-designate, presiding. 

Senators present: Casey. 

Representatives present: Brady, Duffy, Amash, Mulvaney, 

Hinchey, and Cummings. 

Staff present: Will Hansen, Gail Cohen, Colleen Healy, Jessica 

Knowles, Andrew Wilson, Rachel Greszler, Sean Ryan, Jayne 

McCullough, and Ted Boll. 

OPENING STATEMENT OF HON. ROBERT P. CASEY, JR., CHAIRMAN-DESIGNATE, A U.S. SENATOR FROM PENNSYLVANIA 

Chairman-designate Casey. The Joint Economic Committee 

hearing will come to order. I know we have a number of members 

of the House who will be joining us, but they are voting this morning so we will welcome them as they arrive. 

I appreciate this opportunity to review the employment situation 

across the country. We are particularly happy that we have some 

good news to report, which we will review in a moment. But I do 

want to thank the members of the Committee for their work in preparing for this hearing, and for our witness, Dr. Hall; and also the 

continuing opportunity we are going to have on this Committee to 

examine not just the employment data but areas that we can focus 

on to create jobs, strategies to create jobs, and also to focus on important sectors in our economy like manufacturing and other indicators of our economic strength as we are recovering. 

I do want to thank Vice Chairman-designate Brady, Congressman from the State of Texas, who is working with us today to 

make sure that we focus on critically important issues that affect 

jobs. 

We do, as I said, have some good news to report. I know that 

Commissioner Hall will highlight this, but the report today shows 

that the economy added 230,000 private-sector jobs last month, 

making March the 13th straight month that we have employment 

gains in the private sector. 

Also, we gained 216,000 jobs overall, despite the loss of many 

government jobs. I wanted to point to one chart on my left that 

shows the upward trend in employment over the past 13 months. 

2 

In fact, during the last 13 months the economy has added 1.8 million private-sector jobs. 

That is good news, but it is not good enough. We have to continue to focus on ways to create jobs at a faster pace every month, 

not just one month, and not just two months in a row; we need to 

continue to move in the right direction. 

The overall unemployment rate dropped to 8.8 percent, so it has 

come down. That is down from the peak from October of 2009 of 

10.1 percent. But as I said before, the unemployment rate is too 

high and we have to focus intensively—and especially on particular 

demographic groups, whether it’s veterans who have lost their jobs, 

very high numbers still for African Americans, for Hispanic Americans, and workers with a disability. 

And I also know that when Members appear today, some may 

not have a chance to do an opening statement, but I want to make 

sure that Vice Chairman-designate Brady has that opportunity 

when he arrives after voting. 

But I think we will get right to our witness. I want to introduce 

someone who has appeared before this Committee a number of 

times. He does not necessarily need an introduction, but I want to 

make sure that those who may not remember his background and 

are not familiar with his biography, to give you just a brief sketch. 

Dr. Keith Hall is the Commissioner of the Bureau of Labor Statistics for the U.S. Department of Labor—what we know as the 

BLS. BLS is an independent national statistical agency that collects, processes, analyzes, and disseminates essential statistical 

data to the American public, to the United States Congress, and to 

other federal agencies, state and local governments, business, and 

labor. 

Dr. Hall has also served as Chief Economist for the White 

House’s Council of Economic Advisers for two years under President George W. Bush. Prior to that, he was Chief Economist for the 

United States Department of Commerce, and he also spent 10 

years at the United States International Trade Commission. 

Dr. Hall received his bachelor’s degree from the University of 

Virginia; his M.S. and Ph.D. degrees in Economics from Purdue 

University. 

Before turning to Dr. Hall, just one brief interlude. Congressman 

Hinchey just arrived and, Congressman, I was just saying that 

some will have the opportunity to give openings depending on 

when they get here. But if you have any opening comments, I 

wanted to offer you that opportunity. 

Representative Hinchey. Well not really, no. I am anxious to 

hear what is about to be said, because we are dealing with an issue 

which is critically important for the future of this country, and also 

for the political operations in both the House and the Senate. 

And so I deeply appreciate the opportunity to be here with you. 

Thank you very much for setting up this very important hearing 

here, I appreciate you being here, and I am anxious to hear everything that you are going to say. Thank you, very much. 

Chairman-designate Casey. Thanks, Congressman. 

Dr. Hall. 

[The chart titled ‘‘Monthly Change in Private Payrolls’’ appears 

in the Submissions for the Record on page 28.] 

3 

STATEMENT OF DR. KEITH HALL, COMMISSIONER, BUREAU OF 

LABOR STATISTICS, U.S. DEPARTMENT OF LABOR; ACCOMPANIED BY: DR. MICHAEL HORRIGAN, ASSOCIATE COMMISSIONER FOR PRICES AND LIVING CONDITIONS, BUREAU OF 

LABOR STATISTICS; AND MR. PHILIP RONES, DEPUTY COMMISSIONER, BUREAU OF LABOR STATISTICS 

Commissioner Hall. Thank you, Mr. Chairman. 

Mr. Chairman, and Members of the Committee: 

Thank you for the opportunity to discuss the employment and 

unemployment data we released this morning. 

In March, nonfarm payroll employment rose by 216,000, and private-sector employment rose by 230,000. The unemployment rate 

was little changed at 8.8 percent; the rate has declined by 1 percentage point since November of 2010. 

Since a recent low point in February of 2010, nonfarm payroll 

employment has risen by 1.5 million. Private-sector employment 

rose by 1.8 million over the same period, an average of 138,000 per 

month. 

In March, job growth occurred in professional and business services, health care, leisure and hospitality, and mining. Manufacturing employment continued to trend up over the month. 

Professional and business services employment rose by 78,000 in 

March. This industry has added 692,000 jobs since a recent low in 

September of 2009. In March, employment in temporary help services rose by 29,000. Temporary help services has added about a 

half million jobs since August of 2009. 

Employment in health care continued to rise in March. The increase was spread among several components, including ambulatory health care services, hospitals, and nursing and residential 

care facilities. Since the start of the recent Recession in December 

of 2007, health care employment has risen by 902,000, while total 

nonfarm employment has declined by 7.2 million. 

The leisure and hospitality industry added 37,000 jobs in March. 

Growth in food services and drinking places accounted for most of 

the increase. 

Within goods-producing industries, mining employment rose by 

14,000 in March, mostly due to an increase in support activities for 

mining. Since a recent low in October of 2009, mining employment 

has risen by 96,000. 

Employment in manufacturing continued to trend up in March. 

Factory job gains continued to be concentrated in durable goods, 

with over-the-month increases in fabricated metal products and 

machinery. Construction employment changed little over the 

month. 

Employment in local government continued to trend down over 

the month. This sector has lost 416,000 jobs since its employment 

peak in September of 2008. 

Turning to measures from the survey of households, the unemployment rate was little changed at 8.8 percent in March. The jobless rate has declined by one percentage point since November of 

2010. Over that period, unemployment declined by nearly 1.5 million, and employment rose by 1.4 million, leaving the labor force 

nearly unchanged on net. 

4 

In March, the labor force participation rate held at 64.2 percent, 

and the employment-to-population ratio at 58.5 percent was little 

changed. 

The number of long-term unemployed remained high at 6.1 million, or 45.5 percent of total unemployment. Over the month, the 

number of individuals who were working part-time, although they 

would have preferred full-time work, was 8.4 million, down from 9 

million a year earlier. 

In summary, nonfarm payroll employment rose by 216,000 in 

March, and the unemployment rate was little changed at 8.8 percent. 

My colleagues and I would now be glad to answer your questions. 

[The prepared statement of Commissioner Hall, together with 

Press Release No. USDL–11–0436, appears in the Submissions for 

the Record on page 29.] 

Chairman-designate Casey. Doctor, thank you very much. 

I wanted to ask you about, first of all, the sectors of our economy 

that we should be most positive about based upon the data. I wanted to get your perspective on, first of all, manufacturing, which is 

so essential to the strength of our economy. 

I just wanted to get your sense of how you compare this month’s 

numbers not just with last month’s but with what you have seen 

over, say, the last six months? 

Commissioner Hall. Sure. This month, manufacturing grew by 

about 17,000 jobs, which has continued a recent trend. We have 

had job growth in manufacturing. In fact, we have added about 

205,000 jobs in manufacturing since February of 2010, which is the 

employment trough. 

Chairman-designate Casey. And do you have a—I guess it is 

not in the nature of an opinion, but when you compare how we are 

doing overall with job growth this month, about 216,000, and the 

fact that the private-sector job growth has hit 230,000 this month, 

222,000 last month, are there any trends, or any insights that you 

can provide as it relates to the significance of those private-sector 

numbers, at least over the last two months? 

Commissioner Hall. Sure. Well we have had—for more than 

two months we have had pretty steady job growth. It has been 

around 135,000–140,000 a month. In the last two months it looks 

like we may be getting an acceleration in job growth, which would 

be a good sign. 

Chairman-designate Casey. Would you tell us, based upon 

your experience, how many months, when you see a number of 

months of consecutive positive job numbers, especially at what we 

are seeing, which is basically on average about 200,000 jobs added 

the last two months—192,000 and 216,000—how many months like 

that in a row would you like to see as evidence that we are growing 

and recovering at a pace at which we could fully recover? If you 

can understand my question. Would it be that we would need three 

months of positive job growth at that number? Or six months? Or 

how do you analyze that? 

Commissioner Hall. Sure. Well of course even one month, or 

two months of faster job growth is positive. I do tend to look at the 

data at about three-month segments. I think steady growth of 

5 

three months does put you into another—you get a real picture, I 

think, of where you are. So three months, typically. 

But also if you look back to the trend further than that, we continue to have job growth. Again, that is positive. But like I say, 

three months is a good rule-of-thumb that I use. 

Chairman-designate Casey. How about the total number? 

When you look at 200,000 in each of these months, roughly, that 

is a good number. But of course I am trying to get a sense of the 

historical comparison between this two- or three-month period 

versus another two- or three-month period when we had a full, and 

maybe even more, robust recovery. 

Obviously I think we would prefer if it were 250,000 a month 

rather than 200,000, or even higher than that. Is there any way 

to analogize or to compare where we are now as compared to another three-month period that you can recall, or that you have data 

for? 

Commissioner Hall. I would say the last expansion after the 

2001 recession was not a strong expansion. And that averaged at 

its peak somewhere over 200,000. That was growth, but it was not 

as strong as it has been in some other periods. 

In the 1990s expansion, we frequently had job growth well over 

300,000, 400,000 at times. So like I say, 200,000-plus is solid 

growth, but we could see more. 

Chairman-designate Casey. And I know my time is up, but I 

will come back to you about some of the demographic groups. 

Congressman Hinchey. 

Representative Hinchey. Thank you very much. Thank you for 

everything that you are doing in the context of leadership of this 

very important Committee. 

And thank you very much for everything that you were saying. 

We are very delighted to see the economic circumstances changing 

now in light of the fact that we had been experiencing an economic 

situation which was second only to the Great Depression. During 

the most recent recession, we saw the loss of more than 2 million 

jobs, something in the neighborhood of 2.3 million jobs in. 

Now the situation is improving and changing. I know that you 

are analyzing this situation, but do you have any inclination to see 

what the main objectives have been, or rather what is the main 

driver of this economic growth? 

One of the things that we did over the course of the previous two 

years was pass a major stimulus bill, which injected a very significant amount of funding into the economy, which the economy had 

not seen in a long time. 

I would be very interested to hear what you think are the main 

elements of the promotion of this economic activity now, and the 

growing of these jobs? 

Commissioner Hall. Well, sure. Well this Recession has been 

remarkable in how broad the job loss was. So just about every industry, with maybe the exception of health care, lost significant 

numbers of jobs during this Recession. And the job growth now has 

been also pretty broad. 

Industries like professional business services, education and 

health, leisure and hospitality, and even manufacturing have all 

been growing since the trough. Financial activities, construction, 

6 

are probably still struggling. They are not growing very much. And 

government is really the only sector that is losing jobs right now. 

It’s primarily in local government. 

Representative Hinchey. Okay. Anything else? 

Commissioner Hall. No, I think that is about it. The job growth 

has been relatively broad. You know, the biggest drivers probably 

of the job loss have been construction and manufacturing, and it 

has been nice to see manufacturing job growth start up. 

Representative Hinchey. Yes. 

Commissioner Hall. But construction still remains pretty flat. 

Representative Hinchey. And what you were saying in your 

opening remarks were that there were significant improvements in 

the economy in the context of health care and education, things of 

that nature. What would you say about the prospects of cutting the 

funding for operations like health care and education by this government? 

Commissioner Hall. I would not want to comment on policy 

things like that. I stay away from that. 

Representative Hinchey. No, I understand that, but I was just 

trying to see if there might be something that you might say about 

it. 

In any case, this is something that I think we need to be deeply 

concerned about because it would be a deep mistake to reduce the 

funding for those important elements like education, and health 

care, as well as other activities which stimulate this economy—like 

transportation and things of that nature. 

In any case, thanks very much. Let me just ask you one or two 

other things, if I may, if there is time. The Recession hurt certain 

demographics more than others, as we know. For instance, as of 

February individuals without a high school diploma had an unemployment rate of 13.9 percent, while those with a college degree 

had an unemployment rate of 4.3 percent. 

Can you talk about which sectors of our economy typically hire 

individuals without a high school diploma? What has happened to 

those sectors during this Recession? 

Commissioner Hall. Well first let me confirm your picture of 

job loss by education. For those with less than a high school diploma, the unemployment rate remains high; it’s at 13.7 percent 

this month. Those with a bachelor’s degree and higher, it’s at 4.4 

percent. 

This has been a typical recession in the sense that the group 

with the lower education have started with higher unemployment 

rates and they’ve had the unemployment rates go up by more than 

those with higher education. 

As far as the industry breakout, I am probably going to have to 

get back with you on that, about where the folks are distributed. 

I don’t know that we have the data handy, but I can give you some 

idea of where the folks with less than a high school diploma, what 

sort of industries they are employed in. 

Representative Hinchey. Thank you very much. 

[Letter dated April 19, 2011, transmitting Commissioner Hall’s 

response to Representative Hinchey appears in the Submissions for 

the Record on page 68.] 

Chairman-designate Casey. Thanks, Congressman. 

7 

As I mentioned before, the House was voting and Vice Chairmandesignate Brady is here now. I do not know how he could have 

voted and run that fast, but he made it here in record time. I want 

to turn to our Vice Chairman-designate for an opening statement, 

if he would like, and questions as well. 

OPENING STATEMENT OF HON. KEVIN BRADY, VICE 

CHAIRMAN-DESIGNATE, A U.S. REPRESENTATIVE FROM TEXAS 

Vice Chairman-designate Brady. Great. Well first I would 

like to congratulate Senator Casey on the Chairmanship of the 

Joint Economic Committee. I look forward to a productive working 

relationship with the Senator and to insightful hearings as we 

move forward in the new Congress. 

I would also like to welcome Dr. Hall and his staff back again. 

You have guided this Committee through many employment reports in the past. We appreciate the work you do and the explanation of the data that you provide. 

Today’s employment report shows some positive signs. Everyone 

wants the economy to improve, particularly the labor market, and 

we are glad for the increases in jobs we are seeing. But looking at 

it closely, while there are job gains, the rate of job creation has not 

accelerated enough to keep up with the population growth and encourage all of the people who lost their jobs that they soon can find 

work again. 

It has been 21 months since the Recession ended, and we are 

still down 7.2 million nonfarm payroll jobs from when it started. 

The unemployment rate at 8.8 percent of course remains unacceptably high, but also is not telling us the whole story—as I will explain in a moment. 

There have been fundamental disagreements about the proper 

role of government in facilitating an economic recovery between Republicans and Democrats and that disagreement continues even 

now, 39 months after the last recession started. Democrats, unfortunately, in Congress do not want to change course, but the federal 

spending spree has not been productive. 

It loaded up the Nation with debt so large the focus of business 

managers, investors, foreign governments, international institutions, and the public at large now is how the United States can 

meet its financial obligations. 

How high will taxes rise? And what form will they take? Is the 

government resorting to money creation to ease its interest and 

principal payments? Is there a chance it will default on its obligations? 

These questions—incredible as it may seem—are being asked of 

the United States Government. This is a big part of the reason why 

private investment and hiring have not resurged as they did in the 

past after similarly severe recessions. 

I want to show you a chart of payroll jobs. You know, as you can 

see we have not moved far from the bottom we hit shortly after the 

Recession officially ended, and the trajectory of job growth is far 

weaker than in past recoveries. 

I also want to show you a chart of the U.S. labor force participation rate. This chart shows the percentage of the population in the 

8 

labor force as defined by the Bureau of Labor Statistics, and the 

percentage has shrunk. 

The chain of causation is clear: businesses fear the costs of an 

encroaching and intrusive government and are reluctant to expand 

sufficiently to create enough job openings for all of our workers. In 

turn, many people have simply left the labor force. 

The labor force now is smaller than 39 months ago, despite the 

fact that the working age population of 16 years and older has been 

increasing. This is happening in what used to be called the ‘‘land 

of opportunity.’’ 

Republicans want to cut federal spending to relieve the pressure 

on the private economy. We must reassure the Nation and the 

world that the United States will bring its deficits and its debts 

under control, and it will not burden the economy with stifling 

taxes either. 

Increasing taxes to fund the expansion of government depresses 

the private economy’s growth prospects over the longer term, and 

that has chilling effects on businesses and consumers right now. 

The Keynesian argument that increased government spending 

boosts aggregate demand and that a spending reduction would hurt 

the recovery falls apart completely when investors, businesses, and 

consumers focus on the increased future size of government, the 

permanently larger share of resources it will claim, and the myriad 

ways in which it will hamper private economic growth. 

The tepid job and employment growth so long after the Recession 

ended should convince everyone that high levels of federal spending 

are not what the economy needs. 

To reduce federal borrowing, we must cut federal spending not 

try to lock it in or raise taxes. The expected after-tax real rate of 

return drives business investment and hiring decisions. If we want 

businesses to offer hundreds of thousands of additional jobs month 

after month for years to come—which is what it will take to return 

the labor force and the unemployment rate to normal levels—then 

we must not burden expected returns with higher taxes, inflation, 

interest rates, and restrictive regulations. And if the private economy grows, there will be more money for government to spend as 

well, but let us not put that cart before the horse. 

With that, I yield back, Mr. Chairman. 

[The prepared statement of Representative Brady appears in the 

Submissions for the Record on page 71.] 

[The chart titled ‘‘Labor Force Participation Rate’’ appears in the 

Submissions for the Record on page 72.] 

[The chart titled ‘‘An Exceptionally Weak Employment Recovery’’ 

appears in the Submissions for the Record on page 73.] 

[The chart titled ‘‘Private Sector Jobs Increase When Private Investment Increases’’ appears in the Submissions for the Record on 

page 74.] 

[The chart titled ‘‘Increased Federal Spending Has Not Led to 

Private Sector Job Creation’’ appears in the Submissions for the 

Record on page 75.] 

[The chart titled ‘‘Forecast vs. Reality’’ appears in the Submissions for the Record on page 76.] 

9 

Chairman-designate Casey. We can proceed with questions. 

Vice Chairman-designate Brady, do you want to do questions now, 

or move to Congressman Duffy? 

Vice Chairman-designate Brady. Why don’t I take a quick 

question. Can we talk about the participation rate really quickly, 

Commissioner Hall? Obviously it’s always good to see the unemployment rate go down, at least in general appearances, but there 

is more to that story. 

There is no reason to celebrate a lower unemployment rate that 

is caused by more Americans leaving the workforce and fewer entering it. As we know long term, a smaller work force means millions of discouraged workers, lower output in the future, and a 

weak recovery. Those are not healthy signs. 

What can you tell us about the number of discouraged workers? 

What is the number of marginally attached workers? When can we 

expect to see the labor participation rate begin to go back up? 

Commissioner Hall. The number of discouraged workers is just 

a little under a million right now. And workers who are marginally 

attached—which includes discouraged workers, but workers of 

other types—is about nearly 2.5 million people. So those numbers 

are still fairly high. 

Our broadest measure of labor under-utilization that includes 

both marginally attached and people working part-time, that remains fairly high. It’s at 15.7 percent, although it did go down 2/ 

10ths of a percent this month. 

Labor force participation remains at a low level. It is still 64.2 

percent. We have not seen big movement lately at all on the labor 

force. It has actually been fairly flat. But I would expect that if we 

do start to get strong job growth, and we get a little more confidence, we probably should start to see the labor force participation rate go up. 

Vice Chairman-designate Brady. Is the labor force participation rate critical for output for a sustainable recovery? 

Commissioner Hall. Yes. Absolutely. 

Vice Chairman-designate Brady. Any projections going forward? I know you are very careful about doing those things, but 

internally have you done any work on what we might see when 

people will start re-entering the work force? 

Commissioner Hall. I would say we are more in the mode of 

looking for signs that they are, rather than projecting. So we really 

do not—I really do not think that way very much. 

Vice Chairman-designate Brady. I understand. Construction, 

we lost some jobs last month, we had about 30,000 additional—in 

manufacturing and construction—manufacturing did okay, 17,000 

new jobs; construction shrank. Any reasons for that in the data? 

Commissioner Hall. Well, no. Construction has remained pretty flat, and I think just historically what you would probably need 

to see with the construction is you would need to see new housing 

starts, and new home sales pick up, and pick up for a while before 

we start to see any significant change in the construction employment. 

Vice Chairman-designate Brady. Within manufacturing, what 

did you see? 

10 

Commissioner Hall. In manufacturing we are seeing growth. I 

mean, 17,000 was not a lot, but there has been a trend of growth 

in manufacturing. And it is something we have not seen for a 

while, but you are right, it is not really strong; but it is positive 

growth. A lot of that has been in durable goods. So I would say, 

for example, the last recession we did not see any growth in manufacturing out of the last recession at all, so that is part of what 

makes this recovery so far different than the last recession. 

Vice Chairman-designate Brady. I understand. 

And, Senator Casey, we are pleased to be joined by one of our 

new Members from Wisconsin, Congressman Sean Duffy. You are 

chairing the meeting, but I just wanted to welcome Congressman 

Duffy to the Joint Economic Committee. 

Chairman-designate Casey. Thank you very much. 

Congressman Duffy. 

Representative Duffy. Thank you. 

Chairman-designate Casey. And welcome. 

Representative Duffy. I appreciate it. I have got to figure out 

where the ‘‘talk button’’ is here. I am new to the Senate. 

Commissioner Hall, good morning. I appreciate you coming in 

this morning. I just have a few questions. 

As I am looking at historical data in regard to downturns and 

then recoveries, usually there is symmetry or a correlation between 

the depth of the decline and then the strength of the recovery, 

whether it is a V-shaped decline we will have a V-shaped recovery, 

or a U-shaped decline a U-shaped recovery. 

If you look at what has happened in this Recession, we have seen 

a pretty significant decline, but then a flat line really in regard to 

the recovery, which is not consistent with prior recoveries. 

Do you have any idea why that is taking place? 

Commissioner Hall. No, I really do not. I can say that there 

have been two schools of thought going into this recovery. 

The one is the folks who have observed what you have, that the 

deeper recessions have had stronger recoveries, the more V-shaped. 

And those folks of course were optimistic that we are going to get 

a strong recovery. 

Then there are those who have pointed out that the last two recessions had very mild recoveries. But both of the last two recessions were also mild recessions, as well. So it has been one of the 

instances where nobody has known whether we just now have 

milder recoveries from recessions, that is the way the labor market 

has changed; or whether we will go back to the V-shape where 

when we have a steep drop we have a steep recovery. 

Representative Duffy. And maybe I could throw some ideas 

out there. Because I am from a district in central and northern 

Wisconsin, and as I talk to job creators in our area I continually 

hear them talk about uncertainty in the marketplace. And I think 

if you look at what’s happened in Washington in recent years we 

have done things that we traditionally have not done. 

With the new health care bill, I think if you are an employer that 

creates uncertainty in the marketplace. If you have a $14 trillion 

debt, and then this year we are projected to borrow $1.6 trillion. 

And then if you look at the President’s budget, we are projected to 

borrow $1 trillion a year on average for the next 10 years. If you 

11 

are a small businessman and you are looking at investing or growing your business, what I keep hearing is this potentially leads to 

much higher taxes, much less growth, and they are unwilling then 

to invest in the businesses. 

Or if you are a larger business and you can look anywhere in the 

world to invest, and you look at these massive debt charts in America, they go this has serious economic consequences in America, 

and they are choosing to invest elsewhere. 

I mean, do you have any ideas on what I am hearing in central 

and northern Wisconsin from our job creators? 

Commissioner Hall. I would probably stay away from causeand-effect, because we are very much a fact-oriented place. So I 

will beg off on sort of discussing why I think things are happening 

how they are happening. 

Representative Duffy. Let me, if I could do this, are you aware 

of any economic studies that show a correlation between excessive 

deficits and large debts and long-term unemployment conditions, a 

correlation between those two that you have seen in your studies? 

Commissioner Hall. Not really. I am not really familiar. I do 

not know that there is a consensus on any of that. That is not a 

thing that I have studied before in the past. 

Representative Duffy. Okay. I yield back my time. 

Chairman-designate Casey. Thank you, Congressman. Congressman Mulvaney. 

Representative Mulvaney. Thank you, Mr. Chairman. I apologize for being late. I think we just voted on—well, anyway. 

Mr. Hall, Commissioner Hall, I have very brief comments. I 

apologize for missing your testimony, and if these questions have 

been asked previously please let me know and I will be quiet and 

yield back my time. 

I look at these three graphs, and was looking at them yesterday 

as we prepared for this meeting, and I wonder, sir, if you are aware 

of what the unemployment regime was like, what the unemployment benefit regime was like during these last, or these three recessions that are set forth on this board—specifically in 1981, 1982, 

1973, 1975. Do you recall that off the top of your head, sir? 

Commissioner Hall. I really do not; I am sorry. 

Representative Mulvaney. Would it be fair to say that it was 

some place between 26 and 39 weeks? Because that is where it was 

during most of the last several recessions? 

Commissioner Hall. That sounds reasonable, but I really do not 

know. 

Representative Mulvaney. And it is probably also fair to say 

that unemployment in 1981–82, unemployment benefits did not extend for 99 weeks? Nor did they do that in 1973–75, because the 

99 weeks that we are getting to now is unprecedented in our Nation’s history, isn’t it? 

Commissioner Hall. Yes, the long-term unemployed is really 

quite—it is unprecedented right now, the number of long-term unemployed. 

Representative Mulvaney. Correct. But also the benefits that 

we have extended is unprecedented? I recognize you are getting to 

my point, which is that I recognize that you all are not in the business of cause-and-effect looking forward; I am more interested, 

12 

however, in possible correlations looking backward with the benefit 

of hindsight. 

And I am just asking you if you have seen any correlation between the length of benefits that we offer and the length of time 

that folks actually stay unemployed. 

Commissioner Hall. I am not an expert in that area. I do know 

that there has been some research that correlates when people return to work and UI benefits, that there tends to be a pickup in 

re-employment at the end of benefits. 

Representative Mulvaney. And also I think there are some 

studies that show that there is an increase in re-entrants into the 

market, folks that have been identified as actually dropping out of 

the job market do come back at the end of—once benefits go back 

to their ordinary lengths. 

All right, well thank you, Commissioner Hall. I look forward to 

your testimony in the future. 

Chairman-designate Casey. Thanks, Congressman. And, welcome. Thanks for taking the time to be here with us. 

Commissioner, I had some follow-up questions on the demographic breakdown. Even as we are happy about the fact that we 

are at 216,000 by way of an increase overall, and a 230,000 increase in private-sector jobs, there are some demographic numbers 

which are pretty disturbing. 

I was looking at the number, for example, for veterans. Am I correct to say that unemployment among veterans is 9 percent? 

Commissioner Hall. Um—— 

Chairman-designate Casey. I just want to make sure I have 

the right number. 

Commissioner Hall [continuing]. Sure. I believe that is correct. 

Yes, it is 9 percent. 

Chairman-designate Casey. So just for context, 8.8 percent unemployment overall; but 9 percent for veterans? 

Commissioner Hall. Yes, that is correct. 

Chairman-designate Casey. And would I be correct to say that 

so-called Gulf Era II Veterans, meaning Iraq and Afghanistan veterans face an unemployment rate of 10.9 percent? Is that right? 

Commissioner Hall. That is correct. 

Chairman-designate Casey. So substantially higher than both 

veterans overall, almost 2 points higher, and significantly higher 

than the overall unemployment rate. So I think we have got to pay 

particular attention to those veterans coming back from overseas. 

That is intolerably too high, 10.9. 

I was also looking at the African American unemployment rate, 

which is—again I just want to make sure I am right—15.5 percent? 

Is that right? 

Commissioner Hall. That is correct. 

Chairman-designate Casey. And that number is almost double, more than double, I should say, from the African American unemployment rate of 7.7 in August of 2007. That is the number that 

I have. 

Commissioner Hall. Yes, that sounds right. It was 9.0 percent 

at the beginning of the Recession, but that would be right back to 

August. 

13 

Chairman-designate Casey. So 15.5 percent unemployment for 

African Americans. For Hispanic workers, the rate is 11.3? Is that 

correct? 

Commissioner Hall. That is correct. 

Chairman-designate Casey. And for workers with a disability, 

15.6 percent? Is that correct? 

Commissioner Hall. We will get the number here. 

Chairman-designate Casey. Okay. 

Commissioner Hall. You have been right so far, so I am—— 

Chairman-designate Casey. I am just trying to make sure we 

get the record right. But in particular, is there anything you can 

tell us about—based upon your knowledge of the labor market, 

based upon trends you have been able to both identify and analyze 

over the years, and even more recently, is there anything you can 

tell us about those particular demographic categories, why they are 

that high? Or whether these numbers are typical for a time of recession and then recovery? Or maybe there is no conclusion you can 

reach based upon the numbers only? 

Commissioner Hall [continuing]. Sure. It is absolutely true 

that the unemployment rates for these groups start out higher 

than other groups, and in recessions they go up by more. So they 

are hit more by recessions. 

This Recession has been no exception. They have gone up quite 

a bit. As you mentioned, for example, African American going from 

9.0 percent to 15.5 percent is a very large increase. 

As far as why, I do not have great insight as to why that happens, but it does happen. And it is a similar pattern I think as 

some other groups. 

Chairman-designate Casey. Do you have any data that compares, for example, if we just take two or three numbers, the African American number at 15.5 and the Hispanic worker number at 

11.3, any way to compare those two numbers in particular to a 

comparable time period, say in the 1990s as we were coming out 

of a downturn then? Or maybe even 2001–2002? Is there any way 

to compare those, whether 15.5 is substantially higher for African 

Americans at a comparable time, or not? 

Commissioner Hall. Right. We do not have a time series for 

that group that goes back quite that far, at least with us. We could 

probably follow up on that. But the number of 15.5 percent I am 

sure is a very high rate, but we can follow up and—— 

Chairman-designate Casey. Yes, that would be great for the 

Committee, if you can just do kind of a comparison—— 

Commissioner Hall [continuing]. Okay. 

Chairman-designate Casey. Because anyone can tell that it is 

very high. I am just kind of curious about the historical—oh, you 

might have something? 

Commissioner Hall. Okay, actually I do have an answer. We 

had a table I did not realize we had. This is a very high rate. This 

is a higher unemployment rate than the last recession, or the 1991 

recession. The last time it was this high for African Americans, it 

was in the early 1980s it looks like. So this is a very high unemployment rate. 

Chairman-designate Casey. Thank you. I am over time. 

Vice Chairman-designate Brady. 

14 

[Letter dated April 19, 2011, transmitting Commissioner Hall’s 

response to Senator Casey appears in the Submissions for the 

Record on page 77.] 

Vice Chairman-designate Brady. Thank you, Chairman. 

We talked a moment ago about the unemployment rate going 

down, but principally because fewer people are in the workforce 

and many have left it. 

We have an honest disagreement in Congress about what the 

role of federal spending is in our economy and its recovery. You 

know, following the numbers, I know after we spent some $800- 

and-some billion, we have 2 million fewer workers today than when 

the Stimulus began. 

The unemployment rate was predicted to be 6.8 percent this 

month; we are off by a mile. And many of the economists who were 

saying don’t reduce any spending in Washington, today are the 

same ones who like Mark Zandi predicted that by the end of 2010 

we would see 4 million new jobs. We actually had 3.3 million fewer. 

He was off by 7 million jobs. 

The Joint Economic Committee took a look for the last 40 years, 

at my request, at the relationship between federal spending and job 

creation in the private sector along Main Street. This chart identifies it. The black line is federal spending; the darker blue line— 

remind me to do a different color on that one—is private payroll 

employment. Not government jobs, jobs along Main Street. 

What you can see is there is no correlation between the two— 

actually, I am wrong. There is a negative correlation. For each of 

the four decades, as government spending grew jobs along Main 

Street actually shrunk. 

In the next chart, though, it shows sort of a different story. Over 

the last 40 years we tracked one key indicator. Along with workforce participation and output, the key indicator is private investment, business investment: companies that buy new buildings, new 

software, new equipment. 

As you can tell, there is a very high correlation. When businesses, large and small, buy buildings, buy equipment, buy software to go along with that new technology, jobs along Main Street 

grow. 

As we look forward from here, in looking at the data that you 

have, what indicators are you following that indicate where and at 

what speed private business investment is restoring, is picking up, 

is still fairly flat, where is it in America today? 

Commissioner Hall. I do not know that—I do not spend a lot 

of time looking at leading indicators, because we are not trying to 

forecast. But I will say such things as hours worked, and things 

like that, give us some idea of future job growth and future investment levels. In the data, things like temporary help tends to come 

back quicker than other types of jobs. 

Those are the sort of things that tend to be sort of leading indicators of investment and job growth. 

Vice Chairman-designate Brady. Are there any sectors that 

would reflect—obviously new buildings, you are looking at construction, new equipment you would be looking at the more durable 

goods, correct? The larger types of equipment? And new software? 

Are there within those sectors signs we need to be following? 

15 

Commissioner Hall. Well I do think the equipment and software investment, out of the GDP numbers, does track pretty well 

with payroll jobs. And if that tends to get out ahead of payroll jobs, 

it shows up in productivity gains but it also signals sometimes future job growth. 

Vice Chairman-designate Brady. How many jobs are we short 

of the pre-Recession level right now? 

Commissioner Hall. We are down about 7.3 million jobs since 

January 2008. 

Vice Chairman-designate Brady. How large would the monthly job gains need to be over the next 18 months for employment 

to return to that level, to the pre-Recession level? 

Commissioner Hall. I think we are looking at—sorry, I am 

doing my math here; excuse me—I guess we are looking at 403,000. 

Does that sound about right? 

Vice Chairman-designate Brady. It would probably need to be 

higher than that. 

Commissioner Hall. Is it higher than that? Okay. 

Vice Chairman-designate Brady. That is my back-of-the-envelope estimate. If we continued around 200,000 or so job gains per 

month, how long will that take for us—my gut feel is around 5 

years at that level. Your thoughts? 

Commissioner Hall. I have not done that calculation, but if you 

are talking about something like 2.5 million a year, you are talking 

about, well, certainly 36.3 months to recover at a rate of 200,000 

per month. 

Vice Chairman-designate Brady. What monthly job gains—we 

sort of have an indicator, and I am running out of time, how much 

job gains a month is needed just to keep up with the population 

growth? We are often asked that question. 

Commissioner Hall. Yes, that seems to vary over time. I would 

say right now probably at least on the order of 130,000–140,000 

jobs a month just to maintain, with the population growth. 

Vice Chairman-designate Brady. Okay, thank you. 

Thank you, Mr. Chairman. 

Chairman-designate Casey. Thank you, Congressman. 

And Congressman Hinchey. 

Representative Hinchey. Thank you, very much. 

We know what the situation is, how bad it has been, how much 

employment has declined, and how it is now showing indications of 

improvement as a result of a number of initiatives by this Congress. And this chart here is very illustrative. It shows the deep 

drop in employment, and the increase in employment as a result 

of the activities that were taking place over the course of the previous two years. 

I want to talk about manufacturing employment which increased 

for the fourth straight month, as employers added 33,000 jobs in 

February. Fortunately, the number of manufacturing jobs has increased by 186,000 since January of 2010. This is a turnaround, a 

dramatic turnaround, from the 2.3 million jobs that were cut during the deep Recession. 

Can you tell us, what is the future of the manufacturing sector? 

What do you anticipate will be the most influential policies that 

will affect the manufacturing sector? 

16 

Commissioner Hall. Well, you are getting into two areas I try 

to avoid. One is forecasting; the other is policy. I will say, though, 

that the last recession we lost 3 million manufacturing jobs and 

gained none of them back. This Recession we lost another 2 million 

manufacturing jobs, and we are starting to gain some of them back. 

We are not anywhere near 2 million back, but we are gaining some 

back. And that has not happened for a few recessions, a couple of 

recessions. 

Representative Hinchey. Yes, well what do you anticipate will 

be the most influential policies that will affect the manufacturing 

sector? What do you think of some of the things that are trying to 

be done now, will have a positive or negative effect? 

Commissioner Hall. I don’t think I would want to comment on 

likely impact of policies, I’m sorry. 

Representative Hinchey. Okay. Over 44 percent of the unemployed are considered long-term unemployed, meaning that they 

have been out of work for 27 weeks or more. 

Nearly 73 percent of the long-term unemployed have been unemployed for a year or more. What do you think is the reasoning behind why so many of our unemployed have been unemployed for a 

year or more? Do you think we are facing a skills mismatch where 

workers do not have the skills of a changing economy, that they 

have not been prepared for? 

Commissioner Hall. In terms of what the data shows, the number of long-term unemployed during the most recent expansion 

after the 2001 recession, it never went down very much. The expansion after 2001 was not a strong expansion, and normally the 

long-term unemployed goes down a lot more than it did during this 

expansion. 

So the first thing that is a contributor to this is the number of 

long-term was already high when this Recession started. And the 

second thing is, this was a very deep and a very long Recession, 

so it really added to that. And those two things made the number 

at an unprecedented level. It is extremely high. 

I do not know. I do not know what sort of issue there is with job 

matching, job mismatching. I would say that that is certainly something that is going to be of great interest as this expansion goes 

forward as to how the long-term unemployed get re-employed, and 

whether there is an issue with job matching or not. 

Representative Hinchey. Well based upon your experience, do 

you come to the conclusion that intelligent economic investment by 

the government has positive effects on the economy? 

Commissioner Hall. I think I will not comment on—— 

Representative Hinchey. You will pass on that one? 

Commissioner Hall. Yes. 

Representative Hinchey. Mr. Rones, or Dr. Horrigan, any indications of anything on any of the questions that we have asked? 

Mr. Rones. No. I think you will be hard-pressed to find someone 

from the statistical community willing to comment on policy. I 

think it is in everyone’s interest that the reality and the perception 

is that the statistical community, the federal statistical community, 

is really separate from the policy issues. So I think Mr. Hall speaks 

for—Dr. Hall speaks for all of us in that. 

17 

Representative Hinchey. Well, no, I appreciate, because we 

have done this on a number of occasions in the past—I appreciate 

how you separate the logic of how things can be improved, and 

base all of your attention on what the circumstances are, what the 

facts are, but not how they arrived, and what we might do to make 

them better. 

But nevertheless, we continue to just keep asking questions like 

that to see if there might be something that you could provide that 

might be insightful. In any case, I appreciate the responses that 

you gave to these questions. 

Thanks. 

Chairman-designate Casey. Commissioner, if you and your 

team were not so disciplined you could make big news here today, 

but I know you——[Laughter.] 

Are doing your job. 

Congressman Amash. 

Representative Amash. Thank you, Mr. Chair. 

Commissioner Hall, long-term unemployment is costly both for 

individuals who lose valuable skills and experience, as well as the 

government, which is now providing unemployment insurance benefits to workers for up to 99 weeks. 

What impact does long-term unemployment have on workers’ future employment prospects? 

Commissioner Hall. Well that is one of those areas where the 

economic research is pretty clear that the longer somebody is unemployed, the harder it is for them to become re-employed. That 

is why I think, at least for me, one of the absolutely most important things to watch coming out of this Recession is what happens 

to the long-term unemployment because it is at a very high level. 

Representative Amash. And when unemployment benefits run 

out, what typically happens to the unemployment rate? 

Commissioner Hall. I am not sure that I necessarily see a big 

impact on the unemployment rate when those numbers work out. 

People are more likely to stay in the labor force when they are receiving benefits, so there may be some issue where people stop 

looking once their benefits run out, so that may have an impact on 

the labor force. But it’s not been clear, at least in this data yet, 

that that is having an impact. It has not been in the past. 

Representative Amash. Thank you. When arguing for the 

Stimulus, the President’s economic advisors issued a report projecting the likely effects of unemployment and output with and 

without a Stimulus similar to that which eventually passed. 

The President’s advisors projected that the unemployment rate 

would be about 6.8 percent today if Stimulus was passed, and 

about 8.2 percent if Stimulus was not passed. What is the unemployment rate today? 

Commissioner Hall. It is 8.8 percent. 

Representative Amash. And the President’s advisors projected 

total payroll employment at the end of 2010 would be about 138 

million with Stimulus and about 134 million without Stimulus. 

What was the level of payroll employment at the end of 2010? 

Commissioner Hall. Let’s see. How about if I tell you January. 

I’ve got that one handy. It’s 130,328,000. 

18 

Representative Amash. So that is lower than the President’s 

estimates? 

Commissioner Hall. Yes. 

Representative Amash. Massive increases in Federal Government spending have been aimed at increasing employment. Can 

you reconcile the poor job market with the effects of the spending? 

Commissioner Hall. I would not speculate on that. 

Representative Amash. Are there indications that private employers are wary of hiring new workers, given the uncertainties 

surrounding the new health care entitlement and the looming U.S. 

fiscal crisis? 

Commissioner Hall. I do not have any view as to why hiring 

may be slower. 

Representative Amash. So you cannot speculate on—is it possible that the huge amount of spending and the country’s indebtedness has been counterproductive to job creation? 

Commissioner Hall. I just would not want to comment on that. 

Representative Amash. Okay. The Recession has been characterized by a large exit of workers from the labor force. The labor 

force participation rate has dropped nearly 2 percentage points 

since the Recession began. Is the absolute number of workers in 

the labor force smaller now than before the Recession? And by how 

much? 

Commissioner Hall. In terms of payroll jobs we are down by almost 7.3 million payroll jobs. 

Representative Amash. And why have workers left the labor 

force? 

Commissioner Hall. Oh, I’m sorry. The question was a labor 

force question? 

Representative Amash. Yes. 

Commissioner Hall. I guess it is various reasons. This is part 

of what always happens during recessions. The unemployment rate 

goes up and, to some degree, that does not tell you everything that 

is going on in the labor market because lots of people dropping out 

of the labor force does not show up in the standard unemployment 

rate. 

The labor force level is about a half a million below what it was 

before the Recession started. That is despite the population increase. 

Representative Amash. And what can you tell us about workers re-entering the labor force? 

Commissioner Hall. Let me—we will pull up some data here. 

[Pause.] 

Yes, the levels are still low, people who are coming from unemployed to employed. That still has not picked up much—in and out 

of the labor force, that is still at a fairly low level. It is well below 

prior to the Recession. 

Representative Amash. Thank you. I see my time has expired. 

Yield back. 

Chairman-designate Casey. Thank you, Congressman. 

Congressman Duffy. 

Representative Duffy. Thank you. Commissioner, just to follow 

up on some of your points, I think a lot of people are pleased that 

we have a report of, what, 216,000 jobs this month. But you indiVerDate Nov 24 2008 10:43 May 25, 2011 Jkt 065918 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 C:\DOCS\65918.TXT SHAUN PsN: DPROCT
19 

cated with regard to the chart that is up here with labor force participation rates, that it happens in all recessions. And I would 

agree with you. 

But also when we see this decline, and then we are this far into 

the Recession, or this far into job growth, do we not usually see 

greater participation? Don’t we see these rates actually rise in the 

recovery? 

Commissioner Hall. Yes, I would expect that we would at some 

point see that start to rise in a recovery. It happens every recovery. 

Representative Duffy. Right. But isn’t this a sign that there is 

a great deal of weakness in the marketplace right now in regard 

to jobs, when more people are not coming back into the marketplace to seek employment? That would be a leading indicator, potentially, of the strength of the market? 

Commissioner Hall. I would say that is true. I would say that 

seeing people start to re-enter the labor force would be a sign of 

growing confidence that job growth is going to pick up, and we do 

typically see that at some point during recoveries. 

Representative Duffy. But we are not seeing it right now? 

Commissioner Hall. Not yet. 

Representative Duffy. Which, if we are concerned about putting our people back to work, that would give all of us concern 

right now? Is that right? 

Commissioner Hall. Yes, well certainly we would like to see 

that. 

Representative Duffy. Just in regard to long-term, the longterm unemployed, there is a concern about that. Just so I get this 

right, if you are out of the work force for several years, you potentially lose skills? Is that right? And it is harder to get those who 

have been long-term unemployed back into the work force? Is that 

right? 

Commissioner Hall. I think that is right. You know, a lot of it 

probably depends on why people have been unemployed for a longterm time period. Obviously some percentage of them are folks 

whose skills are no longer consistent with industries that have 

strong job growth. 

This time, the number of long-term unemployed is so high I 

would suspect that a large number of the long-term unemployed 

have different characteristics than in the past; that their skills may 

not have eroded; it just may be that we have had a very weak labor 

market. 

Representative Duffy. And I guess my point is leading up to, 

you know I think all of us would like to—if you lose your job, we 

want to help people out. I think we all agree in an American safety 

net. But when you look at extending unemployment benefits for a 

great length of time, would it be your position that that can encourage people to stay out of the job market until those benefits run 

out? And then are we really doing a service to those who we are 

actually trying to help? Or are we doing a disservice with the 

lengthy extension of unemployment benefits? 

Commissioner Hall. I would not want to comment on the impact of something like that. I just don’t know. 

Representative Duffy. Okay. Well but it is fair to say that with 

regard to long-term unemployment benefits, people will stay unemVerDate Nov 24 2008 10:43 May 25, 2011 Jkt 065918 PO 00000 Frm 00023 Fmt 6633 Sfmt 6633 C:\DOCS\65918.TXT SHAUN PsN: DPROCT
20 

ployed until their benefits are about running out, and then they 

will get back into the job market? 

Is that a fair assumption of what happens? 

Commissioner Hall. Well in the past statistically that has 

shown up in research. There have been questions about why that 

is, but that has shown up in research in the past. 

Representative Duffy. And there is also a correlation that the 

longer you stay out of the marketplace the harder it is to find a 

job that is equivalent to the one you had before you left the marketplace? 

Commissioner Hall. That is correct. 

Representative Duffy. And so is it fair then to say there is a 

correlation between long-term unemployment benefits, people staying unemployed for a long period of time, and the difficulty there 

is for them to get back into the marketplace? 

Commissioner Hall. I am not sure I would draw that connection. 

Representative Duffy. Okay. I have nothing further. Yield 

back. 

Chairman-designate Casey. Thank you, Congressman. 

Commissioner, you are really staying on your job here. We talked 

earlier about some of the difficult numbers here for large segments 

of the American people. I mentioned before still high numbers for 

African Americans, for veterans, and for Hispanic workers. So we 

want to balance the positive aspects of these numbers overall with 

the difficulties many people are still having. 

I did want to turn to another chart. Maybe we could just move 

to the GDP chart, to walk through some of these numbers. 

What this chart depicts—and the source that I am going to read, 

this chart was prepared by the Joint Economic Committee staff 

based upon data from the Bureau of Economic Analysis, and I may 

have a question that gets to Commissioner Hall’s work and his 

team—but just to review what it depicts, it is GDP growth for the 

sixth consecutive quarter. Percent change in real GDP from the 4th 

quarter of 2007 to 4th quarter of 2010. 

Obviously at the end of—or I should say, on the left-hand side— 

you have negative 4.0 in the 3rd quarter of 2008; negative 6.8 in 

the 4th quarter of 2008. So the last two quarters of 2008, you have 

negative growth. 

And then you move to the first quarter of 2009, which is when 

you get into the blue color there, the 4.9 percent, the negative 4.9 

percent in early 2009. I would note for the record, there have been 

a lot of references by our colleagues here to the Recovery Act and 

other strategies put in place by the Administration, and a lot of 

votes by Democrats, I might add, that as President Bush was leaving office in the early part of 2009, President Obama is coming into 

office, you have basically two quarters which are negative, ¥6.8 in 

the end of 2008; ¥4.9 in the first quarter of 2009. 

Then of course you see a much-improved number, the ¥.7 in the 

second quarter of 2009. Third quarter 2009, 1.6 in positive. So basically it took all those quarters to get into positive territory. You 

had to go from the second quarter of 2008 to the third quarter of 

2009 to get it back into positive territory. Fourth quarter 2009, 5.0 

21 

on the plus side. And then every quarter since then in 2010 in positive territory. 

I would ask you this. When people see a set of data like that, 

they say, okay, you are getting growth. You are getting positive 

GDP growth quarter after quarter, which is good news. But, they 

say, where are the job numbers to reflect that? And I would ask 

you this about one theory, and I know you cannot endorse or speculate on theories, but one theory is that one of the basic reasons why 

you are not seeing nearly enough job growth, even though you are 

getting positive GDP growth, is because workers and businesses 

are becoming both more efficient—well, maybe not ‘‘both’’—but one 

or the other, either more efficient or more productive, which may 

go hand in hand. Anything you can say about average hours per 

week now, this month or the most recent quarter, versus another 

period, say in 2008 or 2007, anything you can add to that about 

average hours per week? 

[The chart titled ‘‘GDP Grows for Sixth Consecutive Quarter’’ appears in the Submissions for the Record on page 79.] 

Commissioner Hall. Sure. We will pull some data up. I can talk 

about the GDP and payroll jobs, if you like, a little bit. 

Chairman-designate Casey. Sure. 

Commissioner Hall. As well, more broadly. It is typically the 

case that GDP starts to grow out of a recession in advance of job 

growth. 

Chairman-designate Casey. Good point. 

Commissioner Hall. That is typical. This Recession, it was 

about an 8-month lag between the end of the Recession and when 

we started to get job growth. That is not atypical. In fact, that is 

faster than the last couple of recessions. 

Chairman-designate Casey. Let me just interject for a second. 

Just so we have a point of reference, technically—and we know 

how many people feel about this—but technically the Recession 

ended when? 

Commissioner Hall. In June of 2009. 

Chairman-designate Casey. Okay. 

Commissioner Hall. Yes, we have not seen a lot of movement 

in the hours worked, average weekly hours, all employees. That 

has actually been pretty flat now for quite awhile. We really have 

not seen a big pick up at all since the Recession started. 

Chairman-designate Casey. So that has been flat? 

Commissioner Hall. Yes. 

Chairman-designate Casey. Okay. And typically would you see 

a correlation between that number, average hours worked per 

week, going up in a further increase in jobs? 

Commissioner Hall. Yes, typically you would. In fact, typically 

that would give you some indication that the labor market is starting to tighten up, and you are going to see job growth. So it is a 

little bit interesting that we are seeing the job growth occur without having the hours go up. 

Chairman-designate Casey. Okay. I know I am over time, but 

Congressman Mulvaney, did you want a second round? 

Representative Mulvaney. Very briefly, Mr. Chairman, if I 

may. 

22 

Mr. Hall, I appreciate your discipline, and for someone who has 

only been here a couple of months it is actually kind of refreshing 

to actually see somebody just want to answer questions as opposed 

to sit up here and letting us testify. So I am going to do something 

probably unheard of in this environment and actually ask you 

questions that I do not know the answers to in advance. 

Do you all break these things down by different segments? I am 

particularly interested in the job growth, or lack of it, within small 

business. Do you have any information that you could provide us 

on that? 

Commissioner Hall. Yes, actually we do. It is not part of this 

data release, but we do have a couple of different surveys where 

we do look at job growth by firm size, or establishments. 

Representative Mulvaney. Recognizing that you do not have it 

immediately available to you, what can you tell us about job 

growth within the realm of small business? 

Commissioner Hall. Okay. I think one of the ways this recession has stood out compared to other recessions is the job loss has 

been very broad across all sized firms. 

For example, in the last recession in 2001 the job loss there was 

focused in large firms. This recession has been much more even. 

We have had a lot more job loss in smaller firms than we have in 

past recessions. 

Now in terms of the recovery so far, I think there has been a little stronger recovery in the larger firms. But we are still not seeing 

a lot of job growth in some of the smaller firms. 

Representative Mulvaney. To what would you attribute that? 

Again, I am not asking for policy; I am just asking, based upon the 

previous recoveries that you have seen, why would you think that 

small business—to me, for example, let me tell you why I ask the 

question. 

It strikes me, having been involved in primarily small business 

but also familiar with large businesses, that small business is able 

to react a little bit more quickly, especially in an upturn. They see 

opportunities a little bit more quickly and are a little bit more nimble from an organizational standpoint. 

So am I wrong about that? Or is there something different here? 

Why do you think we are seeing a situation where small businesses 

are slower to return to the job creation than larger businesses? 

Commissioner Hall. I will say what I think is the most, one of 

the most important characteristics of this recession compared to 

other recessions. In fact, I would say that we were in a mild recession, maybe even borderline not a recession, until the credit market 

lockup, until the financial market just locked up credit markets. 

And that coincided with a real drop off in new-firm creation, 

which is in large part small firms, and sort of establishment 

deaths, firms going out of business. So that is one of the most notable things, that the credit markets have been really involved in this 

recession. 

And that is sort of consistent with the idea that the smaller 

firms have been harder hit, and perhaps—I am not sure why they 

are slower to recover, I do not really follow the credit markets that 

closely—— 

23 

Representative Mulvaney. No, I see where you are going. It 

actually makes some sense. So what I can divine from that is that 

small businesses rely probably more heavily on the overall credit 

markets. It is harder for them to raise credit. 

Commissioner Hall. Yes. 

Representative Mulvaney. And if the credit markets remain 

tight, it might be possible for a larger business to gain access to 

the credit market, but harder for small business. And that might 

explain why small businesses are slower to create jobs in the recovery. 

Commissioner Hall. It might. 

Representative Mulvaney. Let me ask you the same question, 

very briefly. I have only got a minute-and-a-half. We hear a lot 

about green jobs, and the green economy. Do you break it down by 

that as well? 

Commissioner Hall. We have not in the past. But in fact we 

are in the process of doing that. We actually have a new initiative 

where we are—we have done a fair amount of research in defining 

‘‘green jobs,’’ and we will start collecting data on that in fact later 

this year. 

So that next year we will in fact start producing some of this 

same data we are seeing right now, but broken out by industries 

that are primarily producing green products. 

Representative Mulvaney. Thank you, Doctor. Thank you, Mr. 

Chairman, I yield back the balance of my time. 

Chairman-designate Casey. Thanks, Congressman. 

Congressman Cummings. 

Representative Cummings. Thank you very much, Mr. Chairman. 

Commissioner, it is always good to see you, and particularly good 

to see you when you bring good news. 

I want to just pick up on where my colleague left off just a moment ago. A lot of people seem not to fully appreciate the lock up 

of the credit market and how it does affect small businesses big 

time. 

In my District, a few months ago we had small businesses of all 

kinds come together and talk to the Federal Reserve. And what 

they said was: We have opportunities, but we cannot get lines of 

credit. Our lines of credit have been torn down, and we do not have 

them. 

And so that is very, very significant. And I think the more we 

can open up those lines of credit, the better off folks will be. Because, again, without a line—I mean, I ran a small business for 15 

years—without a line of credit, and it could be for only $50,000, but 

it would make a big difference. 

Dr. Hall, I wanted to ask you, do you see the unemployment rate 

continuing to decrease in the near term? 

Commissioner Hall. I would not want to speculate. I mean, we 

have been on a nice trend here where the unemployment rate has 

dropped and now that drop has held. Obviously I don’t know, going 

forward. 

Representative Cummings. All right. Well let me ask you this: 

What factors, in your opinion, are currently the biggest drivers of 

24 

job creation? I mean, looking at your stats, I know you look at 

trends and that kind of thing. 

Commissioner Hall. Sure. You know, we are getting job growth 

that is reasonably broad. You know, more than a half of the industries are now adding jobs rather than losing jobs. We have been at 

that for a while. So it is fairly broad. 

It just has not—we have not had it in every industry. Construction and financial activities have been kind of flat, and government 

has been declining. But everything else has had essentially job 

growth throughout. So it has been pretty broad. 

Representative Cummings. Despite the steady job figures and 

the positive economic indicators, other indicators present a worrisome picture, Dr. Hall. For instance, a recent Reuters-University of 

Michigan survey shows a 10 percent drop in consumer confidence 

last month, the 10th largest drop on record. 

An editorial by former Labor Secretary Robert Reich explains 

that this drop is attributable to a number of factors, including rising food and fuel prices, as well as expectations of fewer jobs and 

lower wages in the months ahead. 

Theoretically, interconnectedness of consumer confidence and 

employment levels can lead to a somewhat self-fulfilling prophesy. 

If consumers are unwilling to spend money, the economy slows 

leading to fewer jobs, thereby further depressing consumer confidence. 

However, is consumer anxiety about fewer jobs and lower wages 

appropriate? And are they right to feel anxious? And I know you 

do not like to give opinions, but, you know, help me. 

Commissioner Hall. I do not know if they are right or not. You 

know, this is a—— 

Representative Cummings. Well I am looking at the data. 

Looking at the data, if it were you, would you feel anxious? Based 

upon the data that you collect? 

Commissioner Hall [continuing]. I would say we are down a lot 

of jobs still since the Recession started. The unemployment rate is 

very high. Labor force participation is low. So that is plenty to 

worry about. 

Representative Cummings. Moreover, what impact, if any, do 

you believe that this drop in consumer confidence will have on job 

creation in the months ahead? 

Commissioner Hall. I think there the real question is will the 

consumer confidence lead to lower consumer spending. It does not 

always happen. Consumer confidence can fluctuate, and the real 

issue would be does it lower spending? And if consumer spending 

lowers, then it is going to slow down the economy. That is the real 

key, that link between buying and confidence. 

Representative Cummings. And to what extent is the housing 

market influencing job creation in the employment outlook? 

Commissioner Hall. Housing has not contributed for awhile. In 

fact, construction employment just has been flat throughout the recovery so far. 

Representative Cummings. Now you know I always ask you 

two questions that I always like to hear your answer to. 

One, if you were talking to the President right now, the President called you up and said: Hall, what’s the situation? What 

25 

would you—I mean, where are we right now? And what do you see 

for the future? What would you say? 

And the other one is, the other question I always ask you, as people look at this on C–SPAN and they are looking at you as the 

guru of these numbers, and they say, I am wondering what kind 

of field I ought to go into. What training should I do? Where should 

I go in the country to find a job? What would you say? 

Commissioner Hall. Sure. The first question, I think I would 

characterize it kind of as I did in my statement. It is a positive 

thing that unemployment rate, after having fallen for a percentage 

point, has held. We have not had any big movements in the labor 

force, so that fall in the unemployment rate has been from a reduction in the number of unemployed and an increase in the number 

of employed. 

Job growth at 216,000 is job growth, and that is a bit faster than 

it has been in prior months. So I would say on the whole this is 

a positive report. We have got growth in a number of industries. 

Going forward in terms of job growth, you know, two things come 

to mind. In fact, we do have—the one place where we do forecasts 

is we do 10-year projections on occupations where we try to give 

people an idea of exactly the answer to your question: Where are 

the jobs going to be in the next 10 years? And et cetera. 

And the thing that continues to jump out there is a lot of the 

service sector jobs, along with health care, et cetera, jump out as 

likely areas where we are going to have growth. And a lot of it is 

going to depend upon, interestingly, I think the demographics. Because one of the things people underestimate is that we have a certain number of jobs that are replacement jobs. As people retire, 

jobs are going to open up behind them. 

And that is an important thing in this. So it is not just identifying sectors where the number of jobs is growing, but also where 

you have the demographics such that people are retiring and you 

have replacements in there. 

But very broadly, like I say, services in health care jump out at 

you, especially health care with respect to some of this demographics that I am talking about jump out. And if you like, I can 

get you some more detail on our forecasts. If you like, next time 

I can bring some of those numbers with me. 

Representative Cummings. Just one thing you left out, and I 

thank you for your indulgence, Mr. Chairman. Geography. 

Commissioner Hall. Sure. 

Representative Cummings. I mean, if they are sitting there in 

a state where things are just really, really, really bad, where would 

they be looking based upon what you—where might they want to 

look in other areas of the country? 

Commissioner Hall. That is a good question. To be honest, I do 

not recall the regional aspect to that, but I can—— 

Representative Cummings. You will get that to me? 

Commissioner Hall [continuing]. Yes. 

Representative Cummings. All right. Thank you, Mr. Chairman. 

[The prepared statement of Representative Cummings appears in 

the Submissions for the Record on page 80.] 

26 

[Letter dated April 22, 2011, transmitting Commissioner Hall’s 

response to Representative Cummings appears in the Submissions 

for the Record on page 81.] 

Chairman-designate Casey. Congressman, thanks very much. 

I know we are ready to wrap up, unless my colleagues have more 

questions. 

I just had one quick one, though, about the split by gender, men 

versus women, in the job growth. There is some sense that women 

make up a greater share of state and local government jobs, but 

I just wanted to ask you: 

Since February 2010, we have created about a million and a half 

jobs. I am wondering if you have the number of men versus women 

on that? Because I know men were way down in this recent report, 

but I forgot to ask that earlier. 

Commissioner Hall. Sure. Yes, the job growth, we added about 

1.2 million jobs for men, and about 237,000 jobs for women. So it 

was pretty male-oriented in terms of the job growth. 

Chairman-designate Casey. Since February 2010? 

Commissioner Hall. That’s right, since February 2010. That 

also was reflected, for what it’s worth, in the job loss as well. Men 

lost jobs something like 3-to-1 compared to women. 

Chairman-designate Casey. Thanks very much. Unless Vice 

Chairman-designate Brady, or Members have any other questions, 

I think we are adjourned. 

Commissioner, thank you, and Dr. Horrigan and Mr. Rones, 

thank you very much for being here. 

We are adjourned. 

[Whereupon, at 10:51 a.m., Friday, April 1, 2011, the hearing of 

the Joint Economic Committee was adjourned.] 

(27) 

SUBMISSIONS FOR THE RECORD 

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PREPARED STATEMENT OF KEITH HALL, COMMISSIONER, BUREAU OF LABOR

STATISTICS

Mr. Chairman and Members of the Committee: 

Thank you for the opportunity to discuss the employment and unemployment data 

we released this morning. 

In March, nonfarm payroll employment rose by 216,000, and private-sector employment rose by 230,000. The unemployment rate was little changed at 8.8 percent; 

the rate has declined by one percentage point since November 2010. Since a recent 

low point in February 2010, nonfarm payroll employment has risen by 1.5 million. 

Private-sector employment rose by 1.8 million over the same period, an average of 

138,000 per month. In March, job growth occurred in professional and business services, health care, leisure and hospitality, and mining. Manufacturing employment 

continued to trend up over the month. 

Professional and business services employment rose by 78,000 in March. This industry has added 692,000 jobs since a recent low point in September 2009. In 

March, employment in temporary help services rose by 29,000. Temporary help services has added about a half million jobs since August 2009. 

Employment in health care continued to rise in March (+37,000). The increase 

was spread among several components, including ambulatory health care services 

(+18,000), hospitals (+10,000), and nursing and residential care facilities (+9,000). 

Since the start of the recent recession in December 2007, health care employment 

has risen by 902,000, while total nonfarm employment has declined by 7.2 million. 

The leisure and hospitality industry added 37,000 jobs in March. Growth in food 

services and drinking places (+27,000) accounted for most of the increase. 

Within goods-producing industries, mining employment rose by 14,000 in March, 

mostly due to an increase in support activities for mining (+9,000). Since a recent 

low point in October 2009, mining employment has risen by 96,000. Employment 

in manufacturing continued to trend up in March (+17,000). Factory job gains continued to be concentrated in durable goods, with over-the-month increases in fabricated metal products (+8,000) and machinery (+5,000). Construction employment 

changed little over the month. 

Employment in local government continued to trend down over the month 

(¥15,000). This sector has lost 416,000 jobs since its employment peak in September 2008. 

Average hourly earnings of all employees on private nonfarm payrolls were unchanged in March at $22.87. Over the past 12 months, average hourly earnings 

have risen by 1.7 percent. From February 2010 to February 2011, the Consumer 

Price Index for All Urban Consumers (CPI–U) increased by 2.2 percent. 

Turning to measures from the survey of households, the unemployment rate was 

little changed at 8.8 percent in March. The jobless rate has declined by one percentage point since November 2010. Over that period, unemployment declined by nearly 

1.5 million, and employment rose by 1.4 million, leaving the labor force nearly unchanged on net (after accounting for the population adjustment in January). 

In March, the labor force participation rate held at 64.2 percent, and the employment-population ratio, at 58.5 percent, was little changed. The number of long-term 

unemployed remained high at 6.1 million, 45.5 percent of total unemployment. Over 

the month, the number of individuals who were working part time although they 

would have preferred full-time work was 8.4 million, down from 9.0 million a year 

earlier. 

In summary, nonfarm payroll employment rose by 216,000 in March, and the unemployment rate was little changed at 8.8 percent. 

My colleagues and I now would be glad to answer your questions. 

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PREPARED STATEMENT OF REPRESENTATIVE KEVIN BRADY, VICE CHAIRMANDESIGNATE, JOINT ECONOMIC COMMITTEE

I would like to congratulate Senator Casey on the Chairmanship of the Joint Economic Committee. I look forward to a productive working relationship with the Senator and to insightful hearings as we move forward in the new Congress. 

I also would like to welcome Dr. Hall and his staff again. You have guided this 

committee through many employment reports in the past. We appreciate the work 

you do and the explanations of the data you provide. 

Today’s employment report shows some positive signs. Everyone wants the economy to improve, particularly the labor market, and we are glad for the increases 

in jobs we are seeing. But let us be frank, while there are job gains, the rate of 

job creation has not accelerated enough to keep up with population growth and encourage all the people who lost their jobs that they soon can find work again. It has 

been 21 months since the recession ended and we are still down 7.2 million nonfarm 

payroll jobs from when it started. The unemployment rate at 8.8%, of course, remains unacceptably high but also is not telling us the whole story, as I will explain 

shortly. 

There has been fundamental disagreement about the proper role of government 

in facilitating an economic recovery between Republicans and Democrats and that 

disagreement continues even now, 39 months after the last recession started. Democrats still do not want to change course. 

The federal spending spree has not been productive. It loaded up the Nation with 

debt so large that the focus of business managers, investors, foreign governments, 

international institutions, and the public at large now is on how the United States 

can meet its obligations. How high will taxes rise and what form will they take? 

Is the government resorting to money creation to ease its interest and principal payments? Is there a chance it will default on its obligations? These questions—incredible as it may seem—are being asked of the U.S. government. This is a big part of 

the reason why private investment and hiring have not resurged as they did in the 

past after similarly severe recessions. 

I want to show you a chart of payroll jobs. As you can see, we have not moved 

far from the bottom we hit shortly after the recession officially ended and the trajectory of job growth is far weaker than in past recoveries. I also want to show you 

a chart of the U.S. labor force participation rate. This chart shows the percentage 

of the population in the labor force as defined by the Bureau of Labor Statistics, 

and the percentage has shrunk. The chain of causation is clear: businesses fear the 

costs of an encroaching and intrusive government and are reluctant to expand sufficiently to create enough job openings for all of our workers; in turn, many people 

have left the labor force. The labor force now is smaller than 39 months ago, despite 

the fact that the working age population of 16 years and older has been increasing. 

This is happening in what used to be called the ‘‘land of opportunity.’’ 

Republicans want to cut federal spending to relieve the pressure on the private 

economy. We must reassure the Nation and the world that the United States will 

bring its deficit and debt under control and that we will not burden the economy 

with stifling taxes either. 

Increasing taxes to fund the expansion of government depresses the private economy’s growth prospects over the longer term, and that has chilling effects on businesses and consumers right now. The Keynesian argument that increased government spending boosts aggregate demand and that a spending reduction would hurt 

the recovery falls apart completely when investors, businesses, and consumers focus 

on the increased future size of government, the permanently larger share of resources it will claim, and the myriad ways in which it will hamper private economic 

growth. 

The tepid job and employment growth so long after the recession ended should 

convince everyone that high levels of federal spending are not what the economy 

needs. To reduce federal borrowing we must cut federal spending, not try to lock 

it in by raising taxes. The expected after-tax real rate of return drives business investment and hiring decisions. If we want businesses to offer hundreds of thousands 

of additional jobs month after month for years to come—which is what it will take 

to return the labor force and the unemployment rate to normal levels—then we 

must not burden expected returns with higher taxes, inflation, interest rates, and 

restrictive regulations. If the private economy grows, there will be more money for 

government to spend as well, but let us not put that cart before the horse. 

Dr. Hall, I look forward to hearing your testimony. 

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80 

PREPARED STATEMENT OF REPRESENTATIVE ELIJAH E. CUMMINGS

Thank you, Mr. Chairman. 

I thank you for calling the first hearing of the Joint Economic Committee in the 

112th Congress, to enable us to examine the current state of employment in America. 

I congratulate you, Senator Casey, on your new position as Chairman of this Committee, and look forward to your leadership. 

I also thank our witness, Dr. Keith Hall, for appearing before us today to help 

us examine the latest jobs report. It is good to see you as always. 

We learn from today’s report that in March, nonfarm payrolls increased by 

216,000 and the unemployment rate is 8.8 percent. 

These numbers build on the 881,000 private sector jobs created throughout the 

preceding six months, and the 1.5 million jobs created over the past year. 

When contrasted to an earlier period—January of 2008, through February of 

2010, during which our economy shed 8.8 million jobs—it is clear that we have 

averted disaster. 

Yet, a lot of work remains before we can confidently say that our Nation is back 

on the path to prosperity and growth. 

Despite increased hiring, 13.5 million Americans remain unemployed. Almost a 

third of these individuals have been unable to find work for more than one year. 

Moreover, those without a high-school or college diploma continue to experience 

unemployment rates of 13.7 percent, and 9.5 percent, respectively. African-American 

workers remain unemployed at an unacceptably high rate of 15.5 percent. 

Certain critical factors continue to hamper job creation and economic growth, notably, consumer confidence, which has dropped considerably in recent months. However, the heaviest drag on our economy is the continuing foreclosure crisis—a crisis 

that is being driven by mortgage servicing companies that continue to put their bottom lines before American homeowners and the Nation’s economic stability. 

Given this mixed picture, I believe that we are at a critical juncture in our Nation’s journey. 

We avoided the iceberg that threatened in 2008, yet too many of our fellow Americans are floating adrift, or are even drowning in the recession’s aftermath. 

To complicate matters, we are faced with a national debt that has doubled over 

the past decade. 

I believe that the path forward requires smart choices, and compromise. 

Nobel-Prize winning economist Joseph Stiglitz wrote in Politico earlier this week, 

‘‘the ballooning of the deficit... has understandably moved deficit reduction 

back to the center of the debate. But the best way to reduce the deficit is to put 

America back to work.’’ 

I agree with Mr. Stiglitz when he argues that we must invest in infrastructure, 

education, and technology; increase the progressivity of the tax system; and eliminate the corporate welfare hidden in our tax system and in the giveaways of our 

country’s natural resources to oil, gas and mining companies. 

By making these smart choices, according to Mr. Stiglitz, our Nation can easily 

generate trillions in revenue while also creating a fairer society, a cleaner environment, and a more stable economy. 

Instead of making such investments, however, the House majority’s fiscal year 

2011 budget proposal cuts job training programs, Head Start, Pell Grants for college, and veterans housing programs. 

According to calculations by the Congressional Budget Office and economist Mark 

Zandi, the GOP’s budget plan will reduce our projected FY2011 deficit by less than 

4 percent, and yet is projected to cost our Nation 400,000 jobs through the end of 

2011, and 700,000 jobs through the end of 2012. 

These cuts are ostensibly defended with the argument that tough times require 

tough choices and sacrifice. 

I would submit, however, that tough choices and sacrifice have already been borne 

by those who can afford them the least—the children, the elderly, the vulnerable, 

and America’s middle-class. 

This is not the time for symbolism. 

This is the time for smart choices that will create jobs and once again make our 

Nation the land of opportunity for all Americans. 

Again, I thank the Chairman and our witness and I yield back. 

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