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July 2, 2010 in Business
Jobs report shows economic rebound may be stalling
WASHINGTON — A weak June jobs report offered the latest evidence that the economic recovery is slowing.
Employers cut 125,000 jobs last month, the most since October, the Labor Department said Friday. The loss was driven by the end of 225,000 temporary census jobs. Businesses added a net total of 83,000 workers, the sixth straight month of private-sector job gains but not enough to speed up the recovery.
Unemployment dropped to 9.5 percent — the lowest level since July 2009 — from 9.7 percent. But the reason for the decline was more than 650,000 people gave up on their job searches and left the labor force. People who are no longer looking for work aren’t counted as unemployed.
The latest figures suggest businesses are still slow to hire amid a weak economic recovery. Many economists were hoping to see more private-sector job growth, which would fuel the economy by boosting consumers’ ability to spend.
“It could have been worse, but it wasn’t good,” said Nigel Gault, chief U.S. economist at IHS Global Insight, an economic forecasting firm. “It’s adding to the evidence that growth has slowed.”
People left the work force “because they think there’s nothing out there,” he added.
In a separate report, factory orders fell by 1.4 percent in May, the Commerce Department said. It was the first decline after nine months of gains and the biggest drop since March 2009.
The reports follow a slew of data and developments this week that point to slower growth in the months ahead.
In May, home sales plunged and construction spending dropped after a popular homebuyers’ tax credit expired on April 30. Consumer confidence has fallen sharply. The European debt crisis has sent U.S. financial markets downward, lowering household wealth. And more than a million jobless Americans have been cut off from unemployment benefits after Congress adjourned for a weeklong Independence Day recess without extending federal aid.
President Barack Obama said the economy is moving in the right direction, but not quickly enough. He seized on the latest data to push for more government stimulus — including the extension of jobless benefits — to aid the recovery.
“We’re not headed there fast enough for a lot of Americans,” Obama said. “We’re not headed there fast enough for me, either.”
The disappointing jobs report added to investors’ concerns about the economy. The Dow Jones industrial average fell 97 points in midday trading.
The unemployment rate and payroll figures can sometimes move in different directions because they are calculated from different surveys. The jobless rate is derived from a survey of households, while the payroll calculation is drawn from a separate survey of businesses.
The nation still has 7.9 million fewer private payroll jobs than it did when the recession began. The private sector has added an average of 98,000 jobs per month since the beginning of the year. At that rate, it would take nearly seven years to regain the jobs lost during the recession.
It takes about 100,000 new jobs a month to keep up with population growth. The economy needs to create jobs at least twice that pace to quickly bring down the jobless rate.
All told, 14.6 million people were looking for work in June. Counting those who have given up their job searches and those who are working part time but would prefer full-time work, the underemployment rate edged down to 16.5 percent from 16.6 percent in May.
Manufacturers, which have been a key source of job growth in the recovery, are hiring fewer people. Factories added 9,000 jobs in June, down from 32,000 in May and the lowest gain this year.
The leisure and hospitality industries, temporary staffing agencies, and education and health services providers also added jobs. Retailers, construction firms and financial service providers cut payrolls.
Private employers added only 33,000 jobs in May, the department said, below an earlier estimate of 41,000. April private-sector payrolls were revised up to show a total gain of 241,000 jobs, higher than the earlier estimate of 218,000.
The Census Bureau added more than 400,000 workers in May to assist with the 2010 employment count, but most of those jobs lasted only six to eight weeks. Economists expect that census layoffs will impact the payroll data for several more months, but not by nearly as much.
The average work week shortened to 34.1 hours from 34.2, the government said, a disappointing drop after three months of gains. Hourly wages also fell by two pennies to $22.53. The declines mean workers earned less money in the last month.
In addition, the drop in hours is a bad sign because employers are likely to cut hours for their current workers before reducing payrolls.
The employment report comes after Congress adjourned Thursday for the weeklong Independence Day recess without extending jobless aid. That has already left 1.3 million people without benefits. Senate Republicans blocked the extension, citing concerns over the federal deficit. That total number of Americans cut off from benefits could grow to 3.3 million by the end of this month if the impasse isn’t resolved when Congress returns.
© Copyright 2010 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Northwest wheat 
mikeln on July 02 at 12:31 p.m.
We needed to put the money into jobs, instead we gave it to the crooks that caused this mess. If we geared up like we did in WWII and started getting cars on the road that would get us off oil, our country would stop bleeding billions of dollors to the middle east. It is time to stop letting big oil and big corporate run this country. They are the ones that keep blameing the government for our problems when it really is their policies, crammed down our throats, that are the real cause.
Dazzeetrader11 on July 02 at 12:35 p.m.
“May be”? seriously just a “May be”?
Unemployment has skyrocketed…..down only .2% because of how Obama’s defined it nowadays. RECORD numbers of applications for financial help. Census jobs being discontinued.
625 K people not even looking anymore. Seriously the number should be well above 16-18%.
33% reduction in new home sales and the highest repo/forclosure rates since it’s been measured ( 50 years). Cap and trade generating job overseas? Now, the fed has severly curtailed unemployment benfits because they’re no affordable.
All this with those brilliant Obama higher taxes on small business and people over $200K/year with new health care taxes scheduled to being in 6 months.! Get this rookie with the “bright ideas” out of here! No concept of reality or economy!.
Verner is just a jr mirror of his ideas as well. Let’s buy buildings when we’re short of money! Gee…Obama will help us!Gregoire and Marr ascribe to this insanity as well.
Remember in November.
Yikes!! And this is a “May be”?
dwordinger on July 02 at 12:59 p.m.
Without his “stimulus” Obama said unemployment would be 8%. He has worked hard to get unemployment as high as it is.
Unemployment is bad news for whoever is in power. Clinton had his propagandist redefine unemployment. Under the old definition unemployment is now 17%. But even that understates the true unemployment of 21+% (http://www.shadowstats.com/).
Why is Obama working so hard to destroy our economy; taking over the automotive, financial, housing, energy, and other sectors of our economy? Wayne Allen Root thinks Obama, his classmate from Columbia, is implementing the Cloward-Piven plan (http://www.lvrj.com/opinion/obama-s-agenda—overwhelm-the-system-95716764.html) to build reliance on government.
misjustice on July 02 at 1:30 p.m.
People hiring? Where? While we don’t hear about it much any more in the news, people are STILL being laid off. Just ask my daughter who was a victim of the latest round. Single mom with 3 kids. House to pay for, car to pay for & food & clothing to supply for the kids.
Yes, the HealthCare Bill, TARP, Immigration Reform, etc. are all going to help the unemployed… NOT. While our country goes down in flames, our president is once again playing golf, going to concerts, & having his photo opportunities looking at oil balls on the coast line. Can’t believe he let Mexico join in a lawsuit against Arizona. When did he take an oath of office for Mexico?
It’s time he got off his duff & started doing what he was elected to do which is SERVE & PROTECT the people of THIS country.
mikeln on July 02 at 1:35 p.m.
You all forget why these things needed the peoples, our government, intervention. They were being ran by greedy men, men who should be in jail, not free to spend their ill-gotten fortunes. As long as we let these people opperate without regulation they will continue to rob us blind and treat us like the slaves we have become. We won WWII in five years, we could win freedom from oil in ten. Why we are not going in this direction is because of greed. Sure, we might have to give up a few things, but it is worth it to rid ourselves of the people that control us now.
spokanada on July 02 at 1:54 p.m.
And Obama continues to get the blame for the Bush legacy. I personally think Obama should have developed a cure for cancer already. Like seriously, he has been in power a year and a half and people still suffer from cancer! What a horrible, horrible man.
Scoutster on July 02 at 1:55 p.m.
And, what, exactly are we supposed to be doing instead? Cut taxes for the wealthy again? Is that the idea?
How about W’s “Jobs and Growth” from 2003 (Cheney tiebreaker), which was supposed to give us ample jobs and wealth all around by 2008? Anyone have any problem with that sleight of hand now?
It takes a while to turn it around. And with a party who’s very reason for living seems to be to see the president fail, it shouldn’t surprise us.
I’ll certainly look forward to workable alternatives from the GOP that are designed to do more than make the wealthier wealthier. I’d love to hear them. Haven’t yet.
spokanecommunistparty on July 02 at 2:50 p.m.
The GO-P would run in to a burning building to save a corporation and just leave the people inside. It will not matter how many babes you kiss this fall because you will still loose. =)
empyrius on July 02 at 3:23 p.m.
Again the republican versus democrat gig eh.
Seeing how those tax breaks and bailouts for the super-rich have failed to trickle-down to us little people, outside those of us lucky enough to have a job training the thrid world workers who now have our jobs in Asia and South America, we Americans should be grateful for at least one thing -war-!
If it were not for our assorted wars and countless military bases worldwide our domestic economy would have long ago birthed another American Revolution.
Ahhhhh, but one day soon we will get there!
Amen
gonzomo on July 02 at 3:24 p.m.
Scoutster asked:
“And, what, exactly are we supposed to be doing instead? Cut taxes for the wealthy again? Is that the idea?”
While we need substative tax reform at the State and Federal level, the key is STOP SPENDING, STOP SPENDING, STOP SPENDING.
The issue from the Bush years was the spending and Obama has quadrupled since 2007, when Pelosi, Reid, and Murray took over the Congress.
That’s the first thing, stop spending.
misjustice on July 02 at 8:44 p.m.
People seem to forget that the last 2 years of Bush being in office the Democrats had the majority vote and everything Bush tried to do was shot down by the democrats. They controlled the House & Senate so THEY are responsible for the mess we are in. Now, because Obama doesn’t have the majority vote it’s still Bush/GOP’s fault if nothing gets resolved. Still the blame game.
So, just how many years can O-blame-a keep passing the buck? I think he gets up in the morning and the first thing he does is say, “I wonder which GOP I can blame today.” Personally? I’m sick of it.
Dazzeetrader11 on July 02 at 9:45 p.m.
1. http://www.spokesman.com/stories/2009/dec/08/new-obama-plans-spend-our-way-out-downturn/
2. http://www.atr.org/sixmonths.html?content=5171
A. Deficit with Bush was $9 trillion ( way too much) …now with the Incompetent Obama, it’s $13.9 trillion. Nice going buddy!
B. This is Obama’s economy now. He owns it if he has any courage to tell the truth. He doesn’t.
C. Unemeployment was always at or near only 5% during the Bush years.
D. How Obama’s “trickle up” economy treating you Scoutster and Spokanada? We have an expanded (under Obama) war in Afghanistan for you to keep track of. He’s really done a nice job there hasn’t he?
E. I agree with Gramma…Dems have had control for four years running. How’s that going fellas? Complete control of both house and senate druing Obama’s period. How’s that going? How’s Pelosi doing? Is she lucid yet? Or Harry Reid/…he’s getting his clock cleaned by a lady who had $124 K to work with. Reid has $9 million.
F. Want more? Scared yet? Still don’t think Obama’s trying to break down the US so he can bankrupt the country into socialism?
One more thing: All you Obama zealots remember this: whether you’re Repub or Dem, Novemeber is the time to return to American Conservatism…unless you like the trend of the country now. Over 60% of the country doesn’t. Remember in November. Reverse this garbage.
Scoutster on July 03 at 1:55 a.m.
Grover, Daisy? Grover?
How cute.
Dazzeetrader11 on July 03 at 3:33 a.m.
No answer though Scoutster. Speak up son. Can’t, can you?
How do you like your imcompetent fool now? Cuts both ways…he comes for the “wealthy” and now he comes for you too. Best be pullin in those horns and vote conservative.
empyrius on July 03 at 10:14 a.m.
And what exactly will the conservatives do? Start another war?!? Shrink the government (we have been listening to that garbage for 50 years)?!? Privatize social security so grandma can die homeless (so much for moral progression)?!? Deregulate the banking industry so Goldman-Sachs can better do God’s work?!?
Will conservatives immediately withdraw from Afghanistan or Iraq?Will they close all of our military bases in the Middle East? Since conservatives do not want to “social engineer” domestically with they quit trying to social engineer other nations?
What exactly will conservatives do other than legislate their morality upon me?!?
This world would be a far better place if there were no American democrats or republicans!
God bless
Scoutster on July 03 at 1:40 p.m.
Daisy..
I would be happy to respond, but you haven’t made articulate arguments to respond to. Just a series of rants and frustrations.
What I have yet to hear from you and your ilk is what is the alternative, besides “cut taxes”. Take TARP, for instance, which W and Paulson pushed through and was approved because people feared us going off the cliff.
Would you have preferred that GM go under, for example? Would that have been better?
Now, I, personally, feel that TARP just delayed the inevitable, but the GOP sure wanted it, and now they have amnesia.
The unemployment rate was low under W because wages, public and private, were being paid by credit card. You see, Daisy, we have a lot of DEBT out there created not on Jan 20, 2009, but thru years of Republican deregulation and a failed ideology that all taxes are bad, even when the govt chooses to spend (like W not asking for anything for TWO WARS…and he’s the MBA?) Republicans have proven themselves (RR, Papa, W) to be the party of Borrow and Spend. I think that’s not as good as “Tax and Spend”. Yet people still drink the Kool-Aid that somehow these yahoos are fiscal conservatives. They are not. Who left the surpluses, and who left the t*rds?
And, as much as people LOVE to use the word “socialist”, what exactly would that mean in 2010? Is China socialist? Peru? Germany? It’s just red-baiting nonsense for a new generation, and shows the lack of historical literacy of those who use it.
empyrius on July 03 at 3:47 p.m.
Har har har har!
Scoutster applying the smackdown.
You ladies need some tissues after that?!?
He-he-he-he.
misjustice on July 03 at 7:11 p.m.
@Scoutster; SWEET!
If trickle-down-on-me economics, and tax cuts for the top 2% truly worked, then 8 years of Ronnie Ray Gun, 4 years of Papa Bush, and 8 years of Dumbya should have left this nation with a bounding, healthy economy! 20 years of Republican’t rule, interrupted with 8 years of Republican’t Lite (Clinton) and yet all of the Socialist, Maoist, Taoist, Communist, Liberal programs thrust upon us in one short year and a half caused more harm than the preceding 28 years, and totally undid all of the “good” things that the Republican’ts did????
Someone needs to put down the crack pipe!