Job numbers up, but recession unemployment persists

(CBS News) The dreadful string is broken. For the first time in 44 months, the unemployment rate has fallen below 8 percent.

The latest jobs numbers from the Department of Labor today were surprisingly strong. They show the unemployment rate was 7.8 percent in September, down three-tenths of a point from August.

Watch Nancy Cordes' report on President Obama's campaigning on the new, lower jobless numbers.

President Barack Obama waited his entire presidency to finally able to utter the words he's always wanted to say.

"The unemployment rate has fallen to the lowest level since I took office," Obama said.

However, Republican presidential nominee Mitt Romney said the numbers weren't good enough.

"There were fewer jobs created this month than last month," Romney said.

Watch Jan Crawford's report on the Mitt Romney's spin on the new jobless numbers

With just 32 days to go before the election, the jobs report was Topic A among candidates. No president since FDR has been reelected with an unemployment rate this high.

Since FDR, President Ronald Reagan was reelected with the highest unemployment rate in 1984. During his first term, unemployment rose to 10.8 percent. But by election day, it was down to 7.2 percent, which looked so much better in comparison.

For Obama, unemployment peaked in 2009 at 10 percent. Now, three years later, it's at 7.8 percent. For both presidents, unemployment generally trended down all the way to election day.

In September, the economy created 114,000 jobs, and the Department of Labor revised upward the job-creation numbers for the previous two months. It now says 181,000 jobs were added in July and 142,000 in August, a total of 86,000 more than first reported.

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In Circle Pines, Minn. where Delkor Systems makes food packaging machines, CEO Dale Anderson has hired 40 people this year and now has 180 employees.

"I think the economy is really ... it's picking up," Anderson said.

Ryan Broughton is one of those new workers. After leaving his job in construction, he retrained to become a machinist.

Ryan Broughton left a job in construction to retrain as a machinist.
CBS

"I chose manufacturing for the reasons that it doesn't seem so affected by small swings in the economy," he said.

Delkor tripled its research and development budget during the recession. It's paid off. Anderson is building a new plant.

"That's the reason we are moving," he said. "We have plans to continue hiring."

Nationally, the economy's has added an average of more than 145,000 jobs over the past three months, and unemployment has not been this low since January 2009.

"Yes, we're finally below that 8 percent level, but it's still indicative of a slow growth environment," Michelle Meyer, senior U.S. economist for Bank of America, said.

While more than 100,000 jobs is healthy, it's not impressive.

"Think about what we've come off of, the deepest part of post-war recession, and we're adding 100,000 jobs a month," Meyer said. "It's not sufficient."

Much of the drop in unemployment rate is attributed to the growth in part-time jobs.

Amie Crawford, 56, was forced to take a minimum wage job in a Chicago restaurant when she couldn't find full time work as a home designer. She said she didn't even get responses to her resumes.

"I've always believed a bird in the hand is worth two in the bush. I'm not confident in the economy," Crawford said.

Forty percent of the unemployed have been out of work for six months or more. That number did not drop last month.

Federal Reserve Chairman Ben Bernanke said this week his concern is that growth just isn't fast enough to put people back to work.

Even though 150,000 jobs are being created a month right now, that just keeps up with the population growth. We need more than 200,000 jobs to make a dent in unemployment.

  • Anthony Mason

    CBS News senior business and economics correspondent; Co-host, "CBS This Morning: Saturday"

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