Is The US Economy Stalling Again?
US hiring slows amid uncertainty about economy | economy, march, job, growth, hiring, work, jobs, unemployment, months, january.
The Bureau of Labor Statistics said that seasonally-adjusted unemployment rate dropped to 8.2% from 8.3% last month, and the broader U-6 unemployment/underemployment rate dropped to 14.5% from 14.9%, while the …
The U.S. economy grew in March, but at a slower rate than in the previous three months.
Employers made fewer hires, which is a sure sign that if a recovery is in fact taking place, that’s it’s uneven, and sluggish at best.
The Labor Department reported Friday (April 7, 2012) that the US economy added 120,000 jobs last month, compared to more than 200,000 in each of the previous three months.
The unemployment rate dropped to 8.2%, the lowest since January 2009, but the decrease was attributed to fewer people searching for jobs.
And Obama now holds the record for the longest period of time, under any President, that unemployment has remained above 8% at any time since the Great Depression.
Obama’s response to the report was:
“We welcome today’s news. but there will still be ups and downs along the way",
Bu Romney, the front-runner in the GOP race, called the jobs data:
“Weak and very troubling. More and more people are growing so discouraged that they are dropping out of the labor force altogether. The president’s excuses have run out".
And House Speaker John Boehner, R-Ohio, said,
"The report shows small businesses and families are still struggling because of President Obama’s failed economic policies".
Stock markets and bond markets were closed on Good Friday (April 6, 2012), so most investors won’t get to render a verdict on the report until Monday.
The Good, The Bad And The Ugly
Federal Reserve Chairman Ben Bernanke cautioned that:
"The current hiring pace is unlikely to continue without more consumer spending".
Retailers shed nearly 34,000 jobs in March, and temporary help firms dropped almost 8,000 jobs, which is a potentially bad sign for the job market because companies often hire temp workers before adding full timers.
Manufacturers continued to add jobs, hiring 37,000 workers in March.
A broader measure of the labor market, one that adds to the officially unemployed those who have given up looking for work and those forced to settle for part-time jobs, improved last month to 14.5% from 14.9% in February.
The Bureau of Labor Statistics said the economy added 4,000 more jobs in January and February than it previously reported.
For many, what matters most is the unemployment rate. It was 7.8% when Obama entered office in January 2009 and peaked at 10% nine months later. Since August, it has dropped from 9.1% to March’s 8.2%.
No incumbent since World War II has faced voters with unemployment higher than 7.8%.
The 2012 Elections
This year’s election is expected to hinge on the state of the economy, so Obama’s re-election hopes will most likely depend on continued improvement in the unemployment rate and job creation.
And former Massachusetts Gov. Mitt Romney, who will most likely be the Republican challenger, this week blamed the president’s policies for slow growth and high unemployment.
The Obama campaign has said however, that Romney would reinstate policies that led to the recession, things such as, lower taxes for the wealthy and less regulation for business.
Expected Amnnual Growth?
Most economists expect annual growth this year of just 2.5% and it normally takes an annual growth of 4% to lower the unemployment rate 1 percentage point over a year.
So Why Does the Job Market Seem To Be Improving?
The job market appears to be improving, simply because the pace of layoffs has fallen sharply.
For example, the staffing firm Challenger Gray & Christmas reported Thursday that its planned layoffs fell 27% from February to March 2012.
hiring is still running nearly 20% below pre-recession levels!
Will rising gass prices hurt Obama’s impact on his chances?
I think so, but Sullivan on CNBC doesn’t agree.
* Consumer News and Business Channel