In this Aug. 25, 2010 photograph, job seekers including Lindsey Wright, of Detroit, center, attend a job fair in Southfield, Mich. On Friday, Sept. 3, 2010, the Labor Department issued the August unemployment report. (AP Photo/Paul Sancy)
Originally uploaded by Pan-African News Wire File Photos
Christopher S. Rugaber, AP Economics Writer,
On Friday September 3, 2010, 9:50 am
WASHINGTON (AP) -- Private employers hired more workers over the past three month than first thought, lifting hopes for the weak economy ahead of the Labor Day weekend. But the unemployment rate rose in August for the first time in four months as more people entered the market looking for work.
Companies added a net total of 67,000 new jobs last month and both July and June's private-sector job figures were upwardly revised, the Labor Department said Friday.
Stocks surged after the report's release. The Dow Jones industrial
average rose more than 120 points in the first hour of trading and
broader indexes were all up. Wall Street analysts expected a smaller
gain.
While the report hardly suggests the economy is out of danger, it's a
reassuring sign after weeks of troubling data and comes after some
encouraging economic figures in the past week.
Scott Brown, an economist at Raymond James, said he sees no sign of the country slipping back into recession.
"You're still seeing broad-based job gains. It's not strong, but it's
positive," Brown said.
Overall, the economy lost 54,000 jobs as 114,000 temporary census
positions came to an end. For the first time this year, the
manufacturing sector lost jobs -- down a net total of 27,000 for the
month. The auto industry accounted for 22,000 of those lost jobs, the
department said. But those losses were largely due to a shift in the
timing of the industry's summer layoffs.
State and local governments shed 10,000 positions and have had net jobs losses in every month but one this year.
Temporary employment rose by nearly 17,000, after a slight loss in
July. That indicates employers are looking to boost their work forces,
but are reluctant to do so permanently. Temporary hiring averaged
45,000 per month from October to May, but has since slowed.
The jobless rate rose to 9.6 percent from 9.5 percent in July. More
than a half-million Americans resumed their job searches in August,
which drove up the jobless rate. When the unemployed stop looking for work, they are no longer counted in the jobless rate. It's the first
time the labor force has grown since April.
Both June and July's figures were revised to show the private sector
created more jobs in both months. The July figures were revised upward to 107,000 from 71,000. June was revised upward to 61,000 from 31,000. The revisions reflected smaller losses in construction, temporary help services and non-census government jobs.
Still, hiring has now been weak for four straight months. That
deprives consumers of cash and reduces their ability to spend.
Analysts expect economic growth to be tepid for the rest of this year
and the jobless rate could keep rise to 10 percent or more in the
coming months.
Average hourly earnings increased modestly and by more than economists expected, rising to $22.66 from $22.60.
The economy lost nearly 8.4 million jobs in 2008 and 2009. This year, private employers have added back 763,000 jobs. But the unemployment rate has barely moved, ticking down from 9.7 percent in January to 9.6 percent last month.
Including those who have given up looking for work and those who are working part time but would prefer full-time work, the so-called
"underemployment" rate rose to 16.7 percent from 16.5 percent.
A jobless rate nearing 10 percent will ratchet up pressure on the
Obama administration, Congress and the Federal Reserve to do more to jump start the economy. Tax cuts enacted in 2001 and 2003 are set to expire by the end of this year and many rank-and-file Democrats in Congress are joining Republicans in calling for all the cuts to be extended. President Barack Obama wants to let some tax cuts on upper income earners end.
Fed Chairman Ben Bernanke, meanwhile, said last week the central bank will take more steps to stimulate the economy if necessary. But he also said the foundations have been laid for economic growth to
accelerate next year.
No comments:
Post a Comment