The US economic recovery is being held down by the unemployment rate. It's such a problem that despite the fact that the unemployment rate fell from 9.7 percent in May to 9.5 percent in June, more jobs had to be cut than were created. Within the jobs report, the stats were skewed by jobless Americans out of the labor force. The stock market, accepting the numbers at face value, rose slightly Friday morning. Soon after a large decline in factory orders was reported at 10 a.m., the Dow Jones Industrial Average lost 32.5 points. The turgid U.S. economy is full of conflicting information. Even as job creation, factory orders and consumer confidence fell, numerous of the manufacturing companies that want to hire can find workers with the kind of skills they need.
Article source: Unemployment rate down, job loss up, factories hire, what gives by Personal Money Store
Consumer confidence and unemployment rate goes with every little thing else
The unemployment rate effects the whole economy. An uncertain employment picture wreaks havoc on consumer confidence, which went down a lot in June. The decline in consumer confidence led to a decline in auto sales, and pushed pending home sales off a cliff as tax credits for home buyers expired. Consumer spending makes up 70 percent of the U.S. economy, and disposable income is a distant memory for millions of jobless workers.
Why the unemployment rate went down:
The unemployment rate reached its lowest point since July 2009. But the Wall Street Journal reports that the decline wasn't due to improvement within the labor market. June's unemployment rate should have increased with a 125,000 job loss. But 652,000 individuals gave up looking for a job – which happens to be the sharpest one-month decline in 15 years in the Labor Department's survey. Some could be choosing other choices like school. Some are reaching the end of their unemployment benefits, which require an active job search. 1 million individuals stopped looking for work within the last 2 months.
New jobs a mismatch for numerous unemployed workers
The unemployment rate remains stubbornly high because plenty of individuals are still applying for the jobs. It was reported by the New York Times that the problem is a mismatch between the kind of skilled workers needed and also the ranks of the unemployed. During the recession, domestic manufacturers accelerated the long-term move toward more automation, laying off their workers that weren't very skilled and replacing them with cheaper labor abroad. Now these companies have to hire some new individuals who can operate sophisticated computerized machinery, follow complex blueprints and demonstrate higher math skills than old-school assembly line workers.
Does the jobs report have a silver lining?
You have to dig deep to find good things in the last jobs report. It was reported by the Washington Post that Friday’s jobs report could mean that the economic recovery that started last year has lost momentum, but the numbers aren’t so bad as to suggest the nation is heading into a double-dip recession. The numbers, although weak, show just how far the U.S. economy has fallen. The job growth number is a decline from stronger levels in March and April, but the June job creation number of a mere 83,000 is better than any month out of the past 31, other than the last two.
More data about this topic at these websites:
New York Times
nytimes.com/2010/07/02/business/economy/02manufacturing.html?_r=1&ref=us
Wall Street Journal
blogs.wsj.com/economics/2010/07/02/why-did-the-unemployment-rate-drop-2/
Washington Post
washingtonpost.com/wp-dyn/content/article/2010/07/02/AR2010070202004.html?hpid=topnews
No comments:
Post a Comment