[Marxism] U.S. Showed No Job Growth in August; Rate Stays at 9.1%
lnp3 at panix.com
Fri Sep 2 07:02:02 MDT 2011
(This is the first zero growth rate since 1945.)
NY Times September 2, 2011
U.S. Showed No Job Growth in August; Rate Stays at 9.1%
By SHAILA DEWAN
The economy showed no job growth in August, the first time there has
been no increase in net jobs in the United States in 11 months.
The flat performance in the job market was down sharply from a revised
85,000 gain of jobs in July, the Labor Department said Friday, and was
far below a consensus forecast by economists of 60,000. The unemployment
rate stayed constant at 9.1 percent in August.
The nonfarm payrolls numbers were unchanged in August after a prolonged
increase in economic anxiety that began with the brinksmanship in
Washington’s debt-ceiling debate and was followed by the country’s loss
of its triple-A credit rating, stock market whiplash and renewed
concerns about Europe’s sovereign debt.
The jobs figure, a monthly statistical snapshot by the Department of
Labor, may appear more negative because it does not include 45,000
Verizon workers who were on strike when the survey was taken.
Economists blamed both sluggish demand for goods and services and the
heightened uncertainty over the economy’s direction for the slow pace of
job creation, saying political deadlock was in effect creating economic
“Business confidence surveys have uniformly pointed to businesses who
are not laying off workers, but who are holding off on hiring while they
wait for a clearer outlook — an outlook that became much cloudier and
more volatile” beginning with the debt-ceiling battle in July, said
Ellen Zentner, the senior United States economist for Nomura Securities.
There seems to be a consensus among economists that the United States
will skirt a double-dip recession but that growth will linger at levels
barely perceptible, much less comforting, to Americans without jobs.
“We’ve got at least another 12 months of difficulty to go through,” said
Steven Ricchiuto, United States economist for Mizuho Securities USA. “I
know that doesn’t help politicians who are worried about the elections.”
The poor showing is likely to be seized on by President Obama in his
prime-time address to Congress on Thursday as proof that bolder
government action is needed to create jobs.
There is considerable skepticism that any ambitious plan to bolster job
growth would be politically feasible. But several economists said that
given the fragility of the recovery, the payroll tax cut and extended
unemployment benefits, both set to expire at the end of the year, should
“It’s probably not the time for adding to fiscal drag,” said Jim
O’Sullivan, the chief economist for MF Global. He said that together the
tax cut and unemployment account for 1 percent of the gross domestic
Some analysts downgraded their forecast for the jobs numbers on Thursday
based on new economic indicators including weaker online job
advertising, a rise in announced layoffs and a growing pessimism about
the job market by consumers. A major report on manufacturing showed
slowing employment growth and shrinking production and new orders.
But other indicators suggested that fears of recession have outstripped
reality. Consumer confidence dropped sharply and pending home sales
dipped, but in July retail sales increased and orders for durable goods
– expensive items often purchased on credit — were up four percent. On
the other hand, a report on chain-store sales indicated slack
back-to-school shopping, further slowed by Hurricane Irene.
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