Our government may be stalking us, but at least we still have jobs. A new report from the Labor Department out Friday shows the U.S. added 175,000 jobs in May and the unemployment rate rose from 7.5 percent in April to 7.6 percent, which apparently is actually a good thing because it means people are looking for work. The report shows that job growth has remained steady over the past three months, with employers adding an average of 155,000 jobs, but still not as high as the surge -- an average of 237,000 jobs added -- that occurred between November 2012 and February 2013.
Unemployment is still high and job creation hasn't made a big dent this many years into the so-called recovery. Who has the best plan? Is it the Keynesians? On the other end, the Austerics?
The answer is neither, really. They both neglect the economic elephant in the room - spreading wealth to the wealthy keeps buying power away from the middle class; it simply does not lead to economic recovery, historically. Perhaps looking to history can help us learn what works and what doesn't.
Robert Reich (Professor of Public Policy at UC Berkeley, and former Labor Secretary) delivers a compelling argument for a 6-point plan for economic recovery.
More significant, perhaps, are the revisions to March’s gains (up 50,000) to 138,000 and February’s gains (up 64,000) to 332,000. Together, those upwardly revised numbers takes the sting away from March’s dismal numbers and helps to reduce some of the unevenness in job growth.
Meantime, joblessness continues to slowly tick lower. The unemployment rate dropped to 7.5% last month, compared to 7.6% in March. It has fallen from by 40 basis points since January.
Stocks rose following the better-than-expected jobs data. Dow Jones industrial futures gained 103.42 points to 14,767.58. Nasdaq composite futures increased 20.6 points to 2,903.94. S&P 500 futures was up 11.4 points to 1,592.62.
Still the economy is far from completely healed. The labor-force participation rate remains dismally low–remaining at 63.3% in April–at levels unseen since the 1970s, a period when an entire portion of the U.S. population (women) was less likely to work. And despite the upside surprise for the April data, the 165,000 jobs are woefully beneath the point at which the economy needs to reach to hasten the recovery. Economists say the nation must add nearly double that number, closer to 250,000 to 300,000.
The government is now the biggest drag on the job market. Overall, federal, state and local governments cut 11,000 jobs in April.
It's been over five years since the beginning of the Great Recession, and unemployment is still a major economic hurdle in the United States, with long-term unemployment extremely problematic as over 4.6 million Americans have been jobless for at least 27 weeks, according to the latest job figures.
But when a hearing Thursday on long-term unemployment held before the 19-member Joint Economic Committee began, it was with just a single lawmaker in attendance. Panelists testifying on the problem and discussing its potential solutions spoke only to Sen. Amy Klobuchar (D-MN), the committee's vice-chair, for the beginning of the nearly 90-minute session.
Three more Democrats arrived later to join in the meeting, Senator Christopher Murphy (D-CT) arrived eight minutes into the hearing. Then when the hearing had been under way for 35 minutes, Representative John Delaney (D-MD) arrived, and eventually Representative Elijah Cummings (D-MD) joined in bringing the crowd to four.
"When a hearing to explore how to get the long-term unemployed back to work kicked off on Wednesday morning, only one lawmaker was in attendance. That was Sen. Amy Klobuchar, who was holding the hearing in her role as the vice chair of the Joint Economic Committee. The Joint Economic Commitee is one of a handful of committees whose members come from both parties and both houses of Congress. Klobuchar was eventually joined by three colleagues (in order of their appearance): Connecticut Sen. Chris Murphy, Maryland Rep. John Delaney and Maryland Rep. Elijah Cummings. All four are Democrats."
A record 6 million people -- or 27.2 percent of the population -- are unemployed in Spain, the highest level for the country since it began keeping records in 1976. Luckily, there is a silver lining: authorities say the rate of the increase has at least slowed since the recession first began. Spain’s economy -- the fourth largest in Europe -- has relied heavily on the major central banks, but the country has been left in recession by deep spending cuts. “These figures are worse than expected,” said Jose Luis Martinez, a strategist at Citi in Madrid. Spanish President Mariano Rajoy is expected to unveil a new reform plan Friday, but thousands of protesters still converged in Madrid on Thursday.
Hiring picked up in February, helping to bring the unemployment rate down to its lowest level since before Obama took office.
The economy added 236,000 jobs in February, according to a Labor Department report released Friday. That's much stronger growth than in January, when employers hired a revised 119,000 workers.
The gains were broad-based as offices, restaurants, construction firms and hospitals all added jobs.
Meanwhile, the unemployment rate dipped to 7.7%, as 12 million workers were counted as unemployed. The drop was partly because more people said they got jobs, but also because 130,000 people dropped out of the labor force.
The data from the Labor Department on Friday showed the economy gaining traction. The jobless rate fell 0.2 percentage point to 7.7 percent, the lowest since December 2008 as more people found work and others gave up the hunt.
Economists welcomed the report, but worried that budget tightening in Washington could slow the recovery's momentum.
"We had already moved from a slog to a jog and we are on course to really get rolling. The risk here is, while the economy is gathering speed, the politicians are stepping on the brakes," said Bill Cheney, chief economist at John Hancock Financial Services in Boston.
Overall, the U.S. economy has only gained about two thirds of the jobs lost in the financial crisis. Meanwhile, the population has grown and long-term unemployment remains a critical problem.
About 40% of the unemployed have been without a job for at least six months. The average length of unemployment now lasts nine months.
At 13.8%, the unemployment rate is highest for African Americans. Young people are also struggling. Workers ages 20 to 24 had a 13.1% unemployment rate in February, and for teenagers ages 16 to 19, it was 25.1%
Education still makes a big difference. The unemployment rate was only 3.8% for workers over the age of 25 with bachelor's degrees, whereas it was 11.2% for high school dropouts.
Stocks closed out a historic week with another day of gains on Friday, as the Dow hit yet another record closing high on a payrolls report that surpassed even the most optimistic forecasts.
Employers added 157,000 jobs last month and 127,000 more jobs were created in November and December than previously reported, the Labor Department said. Revisions performed each January to the prior year's data showed the labor market was healthier in 2012 than initially thought.
While the unemployment rate rose 0.1 percentage point to 7.9 percent, the closely watched report showed an increase in hourly earnings and solid gains in construction and retail employment.
Weekly jobless claims dropped to a five-year low last week, surprising analysts. During the week ending January 19, applications for unemployment insurance payments decreased by 5,000 to 330,000, the lowest number since the same week in 2008. But this change matches similar patterns in previous calendar years, due to the challenges of adjusting data during the holiday period and at the start of quarters. One expert indicated that the numbers would rise again at the end of the month, saying, "The swings are attributable to the calendar. We're going to pay for this."
A pickup in consumer spending last month may be helping employers look beyond the rancor in Washington over attempts to cut federal spending and trim the national debt. Nonetheless, an increase in the payroll tax at the start of the year has shaken household confidence, raising the risk that sales may cool.
“Away from the calendar swings, the numbers are getting better,” Jones said. “There’s an improvement in the labor market that is in fact going on."
Sixty percent of those under 25 in Spain have no job, and the nation faces its the highest unemployment levels since the 1970s, according data released by the government Thursday. The nationwide jobless rate rose to 26 percent, or 5.97 million people, according to the National Statistics Institute—up from 25 percent the previous quarter. It’s not over yet, either: with the recession likely to last until the end of 2013, net job creation looks increasingly unlikely.
The U.S. economy added 155,000 jobs in December, keeping the unemployment rate steady at just below 8 percent, according to Friday's job report by the Bureau of Labor Statistics. Despite keeping the unemployment rate at its lowest levels since 2008, economists warned that future job growth is unlikely, as they wait for the effects of superstorm Sandy to hit the economy—and also the effect of the Jan. 1 tax hikes. November's job numbers were revised upward slighty from an initial reporting of 7.7 percent unemployment rate.
