(Image Source: Jin Lee/Bloomberg)
BY: MEGAN NOE
There’s just one topic on the minds of business analysts after a shocking labor report Friday.
And to quote the old political yarn -- it’s the economy, stupid.
The latest jobs report shows nearly nonexistent job growth for June-- just 18,000 jobs were added.
Analysts predicted numbers to top 100,000.
That also means unemployment ticked up once again-- to 9.2 percent.
CNN reports what every American already knows-- it’s bad news.
“This report calls into question a rebound at the end of the year that so many people had talked about. But you know what, Fed Chief Ben Bernanke, he gave us kind of a heads up to this a few weeks ago that the job market is weaker than expected, but you know that’s a huge worry to hear the Fed chairman say that. Even Bernanke doesn’t know why the economy is slowing down, why it’s continuing like this. It’s not good news for the recovery.”
The government sector alone was down 39,000 jobs-- and Republicans were quick to jump on the announcement. House Speaker John Boehner tweeted:
“The June unemployment report has Americans asking once again: where are the jobs? We need serious reforms that restrain future spending & spending cuts that exceed any debt limit hike #4jobs – not tax hikes.”
President Obama addressed the report from the White House, citing five reasons for the slow growth.
These include a string of natural disasters, gas price spikes, state and local budget cuts, fiscal problems in Greece and Europe, and uncertainty about whether the government will raise the debt ceiling.
But Washington Monthly says, the lack of economic growth is the result of a political stalemate in Washington -- and neither Democrats nor Republicans seem committed to fixing it.
“When the jobs reports were looking quite good in the early spring, Republican leaders were eager to take creditfor the positive numbers they had nothing to do with. Needless to say, GOP officials are no longer claiming responsibility, and are in fact now eager to point fingers everywhere else.”
On CNBC, Council of Economic Advisers Chairman Austan Goolsbee laid out the White House plan for recovery.
“Number one, let us extend the payroll tax cut. Number two, let us pass the free trade agreements to promote exports in the country. Number three, let’s create the infrastructure bank and put workers back to work. Number four, let’s pass the patent reform bill to encourage entrepreneurs. And number five, let’s pass a balanced bipartisan deficit reduction agreement that removes the uncertainty that is hanging over the business sector about whether the federal government is going to pay its bills.”
But can that plan create the 150,000 to 200,000 jobs per month analysts say are needed just to keep up with population growth? And is this just a soft patch, or a view of things to come? Moody’s Chief Economist offers MSNBC one optimistic prediction.
“If you look at all of the other data economists use to try and gauge today’s numbers, they all point to a much better number. You mentioned ADP, but there’s a lot of others: initial claims for unemployment insurance, there’s surveys of manufacturers and non-manufacturers that showed a lot more strength. So that’s a reason for some optimism and hope that in the next couple, three months we will see better job numbers because all of the other data suggests that this was the outlier.”
Others are much more pessimistic, saying The White House needs to get focused.
“The jobs report is a disaster, both for millions of Americans and for Obama's political prospects. The White House should be making it clear, every single day, that job creation must be the number one priority.” (Salon)
The July numbers are scheduled to be released August 5.
