Washington Post – by Ylan Q. Mui and Amrita Jayakumar
According to the Labor Department, the economy added a disappointing 169,000 jobs in August. In addition, the government lowered its estimate of the number of jobs created in June and July by 74,000 positions.
“We just don’t see this consistent, strong job market that’s really going to entice people to go back into it,” said Michael Evangelist, policy analyst at the National Employment Law Project. “You don’t want people falling out of the labor force where they’re not able to contribute and not able to find work.”
Carol Petty, 54, is among those hanging in the balance. She lost her job as a paralegal in Nevada last summer and has struggled to find work since. Petty moved to California to be near her family and hoped she would find a better job market. She sends out as many as 10 résumés a week and knows she is unlikely to find another position that pays her old salary of $55,100 a year.
She said others in her position have given up seeking work. The question for Petty — and the broader economy — is how long people like her will be able to hold on.
“I’m just so stubborn,” she said. “I will do anything.”
There are demographic trends underlying the decline in the labor force. For much of the past generation, growing numbers of working women boosted its size, but that effect has leveled off. Meanwhile, the first wave of baby boomers is reaching retirement age, while younger workers are staying in school longer before looking for their first job.
Many economists believe those shifts cannot fully explain the size of the decline. Research released this spring by two Federal Reserve economists showed that states with the largest drops in unemployment also had bigger declines in the labor force, suggesting the slow pace of recovery is the culprit.
Before the recession, the government studied population changes and forecast that the participation rate would dip by 0.3 percentage points from 2007 to 2012, according to the paper. Instead, it fell by 2.5 percentage points.
Amanda Dean has almost reached the end of the line. The 30-year-old North Carolina resident has a master’s degree in social work, but has never found a job in her field. She was laid off from her last job, as an office manager, in January.
Her state unemployment benefits ran out in July, and she isn’t eligible for an extension. She doesn’t qualify for food stamps, either. Dean’s parents have been helping pay her mortgage and other bills.
Dean said she has thought about dropping out of the workforce altogether, perhaps going back to school for a business degree. But she realized she couldn’t afford it.
Economists had hoped that the recovery would pick up steam during the second half of this year. But it’s been the decline in the labor force rather than robust hiring that has pushed the unemployment rate to a deceptively low 7.3 percent.
“That’s primarily due to the uncertainty out there,” Funk said, citing new health insurance requirements as well as looming fiscal fights in Washington. “They don’t know how to manage their business as well when they don’t know what their costs are going to be.”
Washington remains a wild card for the economy. Congress must agree on at least a short-term spending plan by October or risk shutting down the federal government. In addition, the nation may not be able to pay all its bills unless lawmakers agree to raise the debt ceiling before a mid-October deadline.
In a remarks Friday while at the Group of 20 summit in Russia, President Obama said he is “determined that the world has confidence in the full faith and credit of the United States.” He also touted gains in manufacturing jobs and new regulations aimed at fortifying the nation’s banks.
“We’ve put more people back to work, but we’ve also cleared away the rubble of crisis and laid the foundation for stronger and more durable economic growth,” he said.
Still, the recovery may not be strong enough to stand on its own. The Federal Reserve has been pumping $85 billion a month into the economy, but will consider reducing that amount when officials convene for their regular meeting this month.
On Friday, Kansas City Fed President Esther L. George called for scaling back the program by $15 billion. In a separate speech, Chicago Fed President Charles L. Evans was more circumspect, but acknowledged the data has been murky.
Fed Chairman Ben S. Bernanke has said that the central bank will begin paring its stimulus this year, and many investors expect it will start this month. But Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities, said he believes the August jobs report is evidence that the economy still needs the Fed’s help.
“This is the time to be thinking more about Main Street, less about Wall Street,” he said.
I have one question: The Federal Reserve has been pumping $85 billion a month into where? The economy? No, if that were true inflation would be very high hyper to be exact. Where is this money going and what are they doing with it?
Look to the Crony Politicians. They (many…most?) vote by the Dollar.
IMO this War(III) we are on the brink of is for money & power in the region (but not limited to), gives energy influence to specific people in that area (SA funding the entire thing if we overthrow Assad – peculiar, no?).
The bankers make huge profits from war as every involved party must buy/build things urgently.
The US economy is on the brink of death as well. War is one band-aid fix, a delay, that will put off the collapse awhile longer too.
They are buying up more of those toxic derivatives under the guise of stimulus. There is still $600 trillion worth floating around in cyberspace.
Where is the money going? The short answer is banks. Primary dealers/institutions sell the Fed the toxic waste and from there some of it finds it way into speculation investment, a few loans to make it look good, while a substantial amount is deposited back at the Fed to which these banks are paid interest on their deposits..these are known as excess reserves. There are more twists and turns to the heist, but that’s the gist of it. It really is quite an operation that the white shoe club has going, and the beauty of it is (from their vantage point that is) that the taxpayers are on the hook for all of it.
also! where is the money going..
you got the fed putting out however much money they want…
then you have the US Gov selling bonds every day….and the fed buying lots of US Gov bond debt,, every day of which they just ….added as an asset to their accounting…by printing it!
basically the fed…is private as a corporate entity, made up of mostly Jews and a few not who were allowed into the club….and this began in 1913 and now, this year their 100yr charter is up…..
i can’t imagine it being turned down thereby bringing about the end of the federal reserve bank
can you?…
Please keep in mind the “unemployment” numbers only show people with either pending or paying Unemployment Insurance (aka UI) claims.
When someones claim ends for whatever reason they are no longer considered “unemployeed” regardless of how job attached or jobless they are.
“Jobless” statistics are the figures that indicate a far more realistic view of the gravity & severity of the unemployment disaster. A situation generated by absurd and largely intentional polices & laws. This is no accident nor is there much intrest incorrecting the problem. I still maintain this IS by design, another facet in the engineered destruction of America.
I too maintain it is by design.
Also within those employed….so many, many are part time and
many many more are minimum wage or close with no way of making a living wage….
this is by design….i believe.
that in my (our) life times, manuf….has been purposefully shipped out of our own land….and many of those industries affected by this, we the american people were the inventors of both the good manufactured and the factory system to get the job done…..
another one of the
“go figure” moments
Deception by numbers; damn Mafia kept better books than these jive-azzed criminal politicians.
Henry Ford didn’t outsource shit and we did just fine.
Anyone who is stupid enough to believe any unemployment or jobs figures from the mainstream media is a fool. There was been no recovery, nor is there going to be. The government agencies haven’t been buying all that ammo because great and prosperous days are ahead, rather they know the end of shell game is here and that crap is about hit the fan head on!