A recent Fox News headline reads: “US employers added 173,000 jobs in August, unemployment rate falls to seven year low of 5.1 percent.” This would indicate the lowest unemployment rate since April 2008.

By that measure, we are clearly out of the woods and the economy must be booming. Yet despite the importance of unemployment as a major economic indicator, the reality is that no one is seeing the beneficial results of this allegedly low unemployment rate.

A chart from the US Census Bureau, by way of former Reagan administration budget chief David Stockman, clearly shows that as of July 2015 the homeownership rate in the US has plunged to the same level it was in 1967.

(Image courtesy Anthony B. Sanders, Equifax.)

A chart from Equifax, by way of Anthony B. Sanders, notes a peak in personal debt in 2008. The so-called deleveraging of the great recession has not only stopped, but has actually gone the other way since the third quarter of 2013.

(Image courtesy Anthony B. Sanders, Equifax.)

Household mortgages are still 69 percent of the average debt burden, but student loans have drastically swelled. Exactly 10 percent of the average consumer’s debt burden consists of student loans, which is more than either outstanding auto loans or credit card debt. This is a debt that is not associated with the consumption of durable goods, meaning it is a burden that generates no effective economic growth.

(Image courtesy Bank of America Merrill Lynch Global Investment Strategy, Bloomberg.)

A chart from Bank of America Merrill Lynch and Bloomberg, depicts a spread that has emerged between US industrial production and the US inventory to sales ratio. A slight uptick in US industrial production is also generating a massive overhang of inventory relative to sales.

Clearing that inventory will require either increased consumption, or decreased industrial production and based on the consumer debt and homeownership figures we’ve just seen, neither option seems likely. Until those inventories clear, this is a headwind for manufacturing production likely to last into the middle of next year.

(Image courtesy Tyler Durden, zerohedge.com)

This is readily apparent in the downturn in the number of manufacturing workers shown by the following chart, courtesy of Tyler Durden at zerohedge.com

Note that the massive destruction of manufacturing jobs that occurred around the 2008 crash has been slowly offset by a steady improvement since then, with the exception of fourth quarter declines in 2012, 2013 and 2014.

As we approach the fourth quarter of 2015, we can expect something similar. However, if the chart looks like the red rash on the left, we may have a semi-permanent unemployment-driven consumption deficit.

Consumers are, in a word, broke.

Image courtesy zerohedge.com.)

So if consumers are struggling, why is unemployment so low? ZeroHedge may have an answer, as shown by this sad, yet amusing chart:

It appears that the downturn in manufacturing workers’ jobs has been neatly offset by an almost identical increase in the number of restaurant service and bartending jobs since December 2007. And that’s the problem with mass media reporting of unemployment figures.

Unfortunately, this doesn’t measure the quality of the work or the disposable income it generates. Very few waiters will be buying a home or a new car in the immediate future, but before the collapse of manufacturing work, this kind of disposable income was the engine of the economy.

We have a long way to go in reshoring and improving productivity. It’s happening slowly, but the bottom line is: I’d rather be brewing, bottling or shipping Budweiser than serving it.