No doubt all of us would take some good economic news right now, but that won’t come from the jobs report for June, which was released this morning showing the unemployment rate rising slightly to 9.2% and adding only 18,000 jobs:
U.S. employment growth ground to a halt in June, with employers hiring the fewest number of workers in nine months, dampening hopes the economy was on the cusp of regaining momentum after stumbling in recent months.
Nonfarm payrolls rose only 18,000, the weakest reading since September, the Labor Department said on Friday, well below economists’ expectations for a 90,000 rise.
Many economists raised their forecasts on Thursday after a stronger-than-expected reading on U.S. private hiring from payrolls processor ADP, and they expected gains of anywhere between 125,000 and 175,000.
The unemployment rate climbed to 9.2 percent, the highest since December, from 9.1 percent in May.
Numbers from the two previous months were revised down by 44,000 jobs; April dropped from 232,000 to 217,000 and May from 54,000 to 25,000. In case you’re wondering, the economy needs to create around 120,000 jobs each just to keep up with population growth.
Another bad sign is the U-6 rate, what many economists call the “real unemployment rate,” jumped from 15.8% to 16.2%.
Just like government intervention in the economy in the 1930s prolonged the Great Depression, intervention and uncertainty with President Barack Obama’s economic policies are slowing the pace of recovery today.
The Bureau of Labor Statistics (BLS) reported this morning that the economy produced 80,000 jobs in June and the unemployment rate held steady at 8.2%. Forecasters expected anywhere from 90,000 to 100,000 jobs. BLS also revised numbers for April, reducing the number created by 9,000 from +77,000 to +68,000 jobs, and May, upward by 8,000 to +77,000 jobs. The U-6 rate, what some economists call the “real” measure of unemployment, actually edged up from 14.8% to 14.9%.
In order to keep up with population growth, the economy needs to produce 120,000 to 150,000 jobs per month.
On Friday, President Barack Obama gave a speech to address the latest monthly jobs report. If the consequences of his policies were not so disastrous, the speech would have been comedy gold. The history of Obama’s promises on the economy is a case study in cognitive dissonance, with promise after promise, then failure, then excuses and accusations. The only thing consistent when it comes to Obama and the economy is that when his predictions prove elusive, it comes as an “unexpected” shock to him and his diehard supporters in the media.
At issue is the jobs report issued by the Department of Labor for June, which reveals that a cadaverous 18,000 jobs were created for the month, 83 percent less than the 105,000 jobs predicted. The “unexpectedly” low jobs growth contributed to the rise in the unemployment rate, which rose to 9.2%. To put this in perspective, economists say that we need to create 125,000-150,000 jobs per month just to keep up with population growth, and we need to be creating roughly 300,000 jobs per month to begin seeing strong economic growth. The news was made even worse by the revelation that far fewer jobs had been created in May than originally reported, which was also “unexpected”.
Shortly after taking office Obama used the fiscal crisis to ram through the “stimulus” package, which we were told would keep unemployment below 8% if passed, and warned that unemployment would go as high as 9% if it did not pass. We passed it, and in the nearly two and a half years since, unemployment rose from 7.8% in January 2009 when Obama took office, to 10.1% in October 2009 (a full eight months after the bill was signed into law), hovered just below 10% for a while before dipping to 8.8% in April 2011. Unemployment has ticked up every month since, and Obama’s own Treasury Secretary warns that it could be more than five years before we see a drop to Bush-era unemployment levels.