Thursday, October 18, 2012
Nike Shox Torch 2 Jobs growth slowed sharply in August
Jobs growth slowed sharply in August, dealing a blow to President Barack Obama as he seeks re-election and setting the stage for the Federal Reserve to pump additional money into the sluggish economy next week.
People wait in line to enter a job fair in New York April 18, 2012. REUTERS/Shannon Stapleton
Nonfarm payrolls increased only 96,000 last month, the Labor Department said on Friday, well below what would normally be needed to put a dent in the jobless rate. Payrolls had grown by 141,000 jobs in July.
While the unemployment rate dropped to 8.1 percent from 8.3 percent, it was only because many Americans gave up the hunt for work. The survey of households from which the jobless rate is derived actually showed a decline in employment for a second straight month.
"The economy is crawling up the down escalator and today's report can only give ammunition to the activist members of the Fed board to loosen monetary policy further next week," said Patrick O'Keefe, head of economic research at J.H. Cohn in Roseland, New Jersey.
The lackluster report piled pressure on Obama ahead of the November vote, with the health of the economy looming large.
While acknowledging the tepid pace of job growth, Obama laid the blame for the labor market's woes on Congress, and Republican lawmakers in particular.
"If Republicans are serious about being concerned about joblessness, we could create a million new jobs right now if Congress would pass the job plans I sent them a year ago," he said at a campaign rally in Portsmouth, New Hampshire.
Republican presidential nominee Mitt Romney said Obama's economic policies had failed.
"There's almost nothing the president's done in the last three and a half, four years that gives the American people confidence he knows what he's doing when it comes to jobs and the economy," Romney told reporters in Sergeant Bluff, Iowa.
The weakness in the jobs market last month was virtually across the board, with average hourly earnings slipping and manufacturing -- the star of the recovery from the 2007-09 recession -- shedding jobs for the first time in nearly a year.
Prospects of more bond purchases by the Fed after its meeting next Wednesday and Thursday lifted U.S. Treasury debt prices and pushed the dollar to a near four-month low against the euro. However, U.S. stocks held steady at four-year highs.
Economists polled by Reuters had expected payrolls to rise 125,000 last month, but some had pushed their forecasts higher after upbeat private sector data on Thursday.
LOOKING FOR A SILVER LINING
Fed Chairman Ben Bernanke last week said the labor market's stagnation was a "grave concern," a comment that raised expectations for a further easing of monetary policy.
The economy has experienced three years of growth since the 2007-09 recession, but the expansion has been grudging and the jobless rate has held above 8 percent for 43 straight months, essentially all of Obama's term and the longest stretch since the Great Depression. Economists say jobs growth in the range of 125,000 a month would normally be needed just to hold the unemployment rate steady.
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