Nation's July Jobless Rate Called Weak

1:43 PM, Sep 7, 2012   |    comments
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USA TODAY

Employers added a disappointing 96,000 non-farm jobs in August and the unemployment rate fell to 8.1% from July's 8.3%, according to a Labor Department report Friday.

The highly anticipated report, which showed job gains well below what economists had expected, could shape voters' views of the economy as the presidential election draws near. It also could prod the Federal Reserve to decide at its policy making meeting next week to help the economy by pumping more cash into it.


President Obama stressed Friday that the number of jobs has increased for 30 straight months, but added that it's "not good enough" and more needs to be done.

"We know it's not good enough," Obama told supporters in Portsmouth, N.H. "We have to create more jobs, faster."


In August, the private sector added 103,000 jobs despite a loss of 15,000 manufacturing jobs. Job gains were strongest in food services and bars, professional and technical services and health care. Federal, state and local governments cut 7,000 jobs.

Jobs created in June and July were revised down with a total of 41,000 fewer jobs created in those two months.

Since the start of 2012, job growth has averaged 139,000 per month compared to an average monthly gain of 153,000 last year, the Labor Department said. The past three months, monthly job gains have averaged 94,000 compared with 95,000 a month in the second quarter and well below the average monthly gain of 225,000 in the first quarter.

"The economy just isn't growing fast enough to generate enough jobs," says economist Paul Ashworth of Capital Economics.

                         Payrolls

                      

The unemployment rate has been above 8% since February 2009, 31 straight months. August's decline doesn't necessarily reflect an improving jobs market. The Labor Department calculates the rate from a household survey while job gains are culled from payroll changes reported by businesses.

The drop in the August unemployment rate fell because 368,000 Americans dropped out of the labor force - meaning they retired, stopped working or were too discouraged to look for work. Perhaps more disappointing: The labor force participation rate - the portion of the population working or in search of a job - fell to its lowest level in more than three decades.

And the report offered few signs that job growth is on track to gain significant strength. The average workweek was unchanged at 34.4 hours. Employers typically increase the hours of existing employees before hiring additional staff, which isn't happening. And average hourly earnings dipped by one cent to $23.52. 






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