Unemployment Rate in July Unchanged at 9.5%
Companies showed a lack of confidence about hiring for a third straight month in July, making it likely the U.S. economy will grow more slowly the rest of the year. The unemployment rate was unchanged at 9.5 percent.
Most economists expected much stronger job growth last month and now some are wondering if the recovery is in jeopardy, reports CBS News correspondent Rebecca Jarvis. For seven straight months, companies have hired new workers, but in very small numbers.
Private employers added a net total of only 71,000 jobs in July, far below the 200,000 or more jobs needed each month to reduce the unemployment rate.
President Barack Obama, however, hailed the jobs report as a good sign for the economy. But he says the progress "needs to come faster."
The modest gains were even weaker when considering a loss of government jobs at the local, state and federal levels in July that weren't temporary census positions. Factoring those in, the net gains were only 12,000 jobs, according to the Labor Department's July report Friday.
Investors reacted by selling stocks and shifting into more conservative Treasury bonds.
The department also sharply revised down its jobs figures for June, saying businesses hired fewer workers than previously estimated. June's private-sector job gains were lowered to 31,000 from 83,000. May's were raised slightly to show 51,000 net new jobs, from 33,000.
"There is still a labor market recovery, but it's a very, very weak one," said Nigel Gault, chief U.S. economist at IHS Global Insight.
The slow pace of hiring will weigh on the recovery, he said, with economic growth in the current quarter likely to come in even lower than the April-to-June quarter's already weak 2.4 percent.
Overall, the economy lost a net total of 131,000 jobs last month, mostly because 143,000 temporary census jobs ended.
Christina Romer, chair of the Council of Economic Advisers said in a White House blog post that the job growth reflected "important variation in employment growth across industries."
"Employment in manufacturing as well as education and health services increased, while that in financial services and construction decreased," Romer said. "Employment in state and local government, including public school teachers, decreased 48,000, underscoring the importance of the additional state fiscal relief working its way through Congress."
The "underemployment" rate was the same as in June, at 16.5 percent. That includes those working part time who would prefer full-time work and unemployed workers who've given up on their job hunts.
All told, there were 14.6 million people looking for work in July. That's roughly double the figure in December 2007, when the recession began.
Even if hiring picks up, it will take years to regain all the jobs lost during the recession. The economy lost 8.4 million jobs in 2008 and 2009. This year, private employers have added only 559,000 new hires.
Friday's report is being closely watched by the Federal Reserve as it considers ways to energize the recovery. The report could persuade the Fed to take new steps to boost the economy and keep interest rates at record lows when it meets next week.
Without more jobs, consumers won't see the gains in income needed to encourage them to spend more and support economic activity. Even those with jobs may not feel confident enough to ramp up their spending.
That's important because many of the trends driving economic growth earlier in the recovery are fading. The economy grew at 5 percent in the fourth quarter last year and 3.7 percent in the first three months of 2010. But that slowed to 2.4 percent in the April-June period. That's not fast enough to generate many jobs and reduce the unemployment rate.
Many companies appear to be getting more out of their current employees rather than adding new staff. The average work week increased by one-tenth of an hour to 34.2 hours, the department said. That's up from about 33 hours in the depths of the recession.
Average hourly pay also rose 4 cents to $22.59, up 1.8 percent from a year earlier. That, along with the increase in hours worked, could provide some boost to spending.
The number of temporary jobs fell by 5,600, the first drop after nine months of gains.
Employers usually hire temp workers if they need more output but don't want to hire permanent employees. But "firms aren't even adding temporary workers right now," Gault said.
Manufacturers added 36,000 jobs in July, slightly above its monthly average this year. Those gains were aided by General Motor's decision to keep its plants running last month. Usually it closes them and temporarily lays off employees to retool for the new model year.
Construction firms cut jobs for the third straight month, losing 11,000, while financial firms shed 17,000 workers.
But retailers added 6,700 jobs. And the leisure and hospitality industry hired 6,000 additional staffers.
Corporate net income rose sharply in the second quarter, but businesses aren't yet using the proceeds to ramp up hiring. Companies in the S&P 500 index reported a 46 percent increase in net income for the April-to-June period, compared to a year earlier.
But many employers are uncertain about the direction of the economy. Some are concerned sales will slow once government stimulus and other temporary factors fade. Others fear what will happen if federal income taxes are allowed to rise next year as tax cuts enacted by President George W. Bush expire.
"People have a long worry list they're looking at," said Ethan Harris, chief economist at Bank of America Merrill Lynch.
Some companies are adding permanent workers. The hospital chain HCA Inc. has 8,300 open positions, company spokesman Ed Fishbough said. That includes nurses, physicians and information technology professionals needed to build HCA's ability to handle electronic medical records. HCA employs about 190,000 people.
But layoffs are also continuing. FBR Capital Markets, an investment bank based in Arlington, Virginia, cut its work force by about 15 percent in early July to about 500 employees, saying it needed to reduce costs.
© 2010 CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report. Most economists expected much stronger job growth last month and now some are wondering if the recovery is in jeopardy, reports CBS News correspondent Rebecca Jarvis. For seven straight months, companies have hired new workers, but in very small numbers.
Private employers added a net total of only 71,000 jobs in July, far below the 200,000 or more jobs needed each month to reduce the unemployment rate.
President Barack Obama, however, hailed the jobs report as a good sign for the economy. But he says the progress "needs to come faster."
The modest gains were even weaker when considering a loss of government jobs at the local, state and federal levels in July that weren't temporary census positions. Factoring those in, the net gains were only 12,000 jobs, according to the Labor Department's July report Friday.
Investors reacted by selling stocks and shifting into more conservative Treasury bonds.
The department also sharply revised down its jobs figures for June, saying businesses hired fewer workers than previously estimated. June's private-sector job gains were lowered to 31,000 from 83,000. May's were raised slightly to show 51,000 net new jobs, from 33,000.
"There is still a labor market recovery, but it's a very, very weak one," said Nigel Gault, chief U.S. economist at IHS Global Insight.
The slow pace of hiring will weigh on the recovery, he said, with economic growth in the current quarter likely to come in even lower than the April-to-June quarter's already weak 2.4 percent.
Overall, the economy lost a net total of 131,000 jobs last month, mostly because 143,000 temporary census jobs ended.
Christina Romer, chair of the Council of Economic Advisers said in a White House blog post that the job growth reflected "important variation in employment growth across industries."
"Employment in manufacturing as well as education and health services increased, while that in financial services and construction decreased," Romer said. "Employment in state and local government, including public school teachers, decreased 48,000, underscoring the importance of the additional state fiscal relief working its way through Congress."
The "underemployment" rate was the same as in June, at 16.5 percent. That includes those working part time who would prefer full-time work and unemployed workers who've given up on their job hunts.
All told, there were 14.6 million people looking for work in July. That's roughly double the figure in December 2007, when the recession began.
Even if hiring picks up, it will take years to regain all the jobs lost during the recession. The economy lost 8.4 million jobs in 2008 and 2009. This year, private employers have added only 559,000 new hires.
Friday's report is being closely watched by the Federal Reserve as it considers ways to energize the recovery. The report could persuade the Fed to take new steps to boost the economy and keep interest rates at record lows when it meets next week.
Without more jobs, consumers won't see the gains in income needed to encourage them to spend more and support economic activity. Even those with jobs may not feel confident enough to ramp up their spending.
That's important because many of the trends driving economic growth earlier in the recovery are fading. The economy grew at 5 percent in the fourth quarter last year and 3.7 percent in the first three months of 2010. But that slowed to 2.4 percent in the April-June period. That's not fast enough to generate many jobs and reduce the unemployment rate.
Many companies appear to be getting more out of their current employees rather than adding new staff. The average work week increased by one-tenth of an hour to 34.2 hours, the department said. That's up from about 33 hours in the depths of the recession.
Average hourly pay also rose 4 cents to $22.59, up 1.8 percent from a year earlier. That, along with the increase in hours worked, could provide some boost to spending.
The number of temporary jobs fell by 5,600, the first drop after nine months of gains.
Employers usually hire temp workers if they need more output but don't want to hire permanent employees. But "firms aren't even adding temporary workers right now," Gault said.
Manufacturers added 36,000 jobs in July, slightly above its monthly average this year. Those gains were aided by General Motor's decision to keep its plants running last month. Usually it closes them and temporarily lays off employees to retool for the new model year.
Construction firms cut jobs for the third straight month, losing 11,000, while financial firms shed 17,000 workers.
But retailers added 6,700 jobs. And the leisure and hospitality industry hired 6,000 additional staffers.
Corporate net income rose sharply in the second quarter, but businesses aren't yet using the proceeds to ramp up hiring. Companies in the S&P 500 index reported a 46 percent increase in net income for the April-to-June period, compared to a year earlier.
But many employers are uncertain about the direction of the economy. Some are concerned sales will slow once government stimulus and other temporary factors fade. Others fear what will happen if federal income taxes are allowed to rise next year as tax cuts enacted by President George W. Bush expire.
"People have a long worry list they're looking at," said Ethan Harris, chief economist at Bank of America Merrill Lynch.
Some companies are adding permanent workers. The hospital chain HCA Inc. has 8,300 open positions, company spokesman Ed Fishbough said. That includes nurses, physicians and information technology professionals needed to build HCA's ability to handle electronic medical records. HCA employs about 190,000 people.
But layoffs are also continuing. FBR Capital Markets, an investment bank based in Arlington, Virginia, cut its work force by about 15 percent in early July to about 500 employees, saying it needed to reduce costs.
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http://www.foxnews.com/politics/2010/08/07/magliocchetti-case-involving-late-dem-draws-coverage-abramoff-scandal/?test=latestnews
RECESSION - is when YOUR NEIGHBOR loses HIS job.
DEPRESSION - is when YOU lose YOUR job.
RECOVERY - is when Obama loses his job.
What would have happened if Obama did not lead and provide an economic stimulus?
I heard that another 8 million jobs would have been lost and the GDP could have fallen as much as 11%.
Yeah the job losses would have been huge if we had listened to th GOP and let GM would have gone under with all of its suppliers!
If bailing out GM was such a bad thing for our country, where was the GOP plan to save these jobs?
In fact where is the GOP plan to bring the jobs back?
Let me guess we'll wave the income tax requirement for business and the wealthy so they have enough and rely solely on trickle down again?
Well to quote someone who actually has a brain, "doing the same thing and expecting different results is insane".
Pleae join me to vote out the trickle down champions and lets try something else! We can certainly achieve better resuls than trickle down provided!
YES WE CAN!
WHERE ARE THE JOBS?????
IF YOU CAN, WHY DIDN'T YOU?
#1 question the dumbocrats don't want you to ask.
WHERE ARE THE JOBS?????
+++++++++++++++++++++++++++++++++++++++
They have been outsourced to China to cut costs an increase the profitability of the corporations for the wealthy investors!
Quite patriotic isn't it. Lets fire Americans and ship their jobs offshore because they are unwilling to work 60 hour weeks at $ 1.00 per hour so the CEO can make 25 million per year!
After all, is not about patriotism anymore, its about selling out your fellow Amercans so you can make more money!
Yeah! Vote GOP so they can say "Mission accompishd"!
There are plenty of jobs out there.
Do you mean somewhere out there, like:
Somewhere over the rainbow
Way up high,
There's a land that I heard of
Once in a lullaby.
Somewhere over the rainbow
Skies are blue,
And the dreams that you dare to dream
Really do come true.
Someday I'll wish upon a star
And wake up where the clouds are far
Behind me.
Where troubles melt like lemon drops
Away above the chimney tops
That's where you'll find me.
Somewhere over the rainbow
Bluebirds fly.
Birds fly over the rainbow.
Why then, oh why can't I?
If happy little bluebirds fly
Beyond the rainbow
Why, oh why can't I?
Really, who knew?, I am shocked. Seems like everyone knows it except for the POTUS and his trusty sidekicks Pelosi and Reid.