Oh, the jobs report. The first Friday of every month is a day of anticipation and anxiety as we await the release of the Department of Labors’ monthly employment situation summary. Will the unemployment rate finally drop? Will the U.S. create more jobs? Will the “long slog” towards economic recovery finally speed up a little?
No, some, seems unlikely. The July unemployment rate increased to 8.3% from 8.2% in June (which at least three newspapers referred to as just a “ticking up,” though deeper analysis reveals that a broader unemployment measure actually shows a 15% increase in total unemployment), and the number of jobs increased by 163,000.
the economy now produces as many goods and services — more, in fact — than it did before the downturn officially began in December 2007. But it does so with almost five million fewer jobs.
This is a lot of American workers doing the work of more than one person, and it could be a sign that employers are still too uncertain about the economy to invest in hiring more workers. Even still, the Dow Jones surged 2% after the jobs report was released, so at least Wall Street found something to like. And since it’s an election year, there’s plenty of talk about what this means for the electoral prospects of President Obama and Governor Romney.
So what’s going on? Matthew Yglesias at Slate is among those who think the Federal Reserve is not helping improve matters. While they noted earlier this week that the economy is not looking so great now, it’s not going to improve dramatically in the near future, and inflation is going to stay pretty low, the Fed isn’t going to move to loosen monetary policy (i.e., make more money and credit available in the market) right away. The European Central Bank isn’t making big moves, either.
Another frequent target of scorn is the Federal Housing Finance Agency, whose acting director decided this week not to implement debt forgiveness for underwater homeowners (NLIHC takes no position on this matter). Writing in the New York Times, Paul Krugman says that “reducing the burden on Americans in financial trouble would mean more jobs and improved opportunities for everyone,” so some principle reduction scheme should be implemented.
What’s your take on this month’s jobs report? Do you have hope for the economy turning around? What do you think elected leaders and federal agencies should do about it? How about the private sector? Let’s talk about it the in comments.