Jobs report: press and dems seize on the negative
Reuters reports: “Payrolls Barely Rise in Weak Jobs Report.”
First the facts:
Unemployment rate fell to 5.7 percent, the lowest in over a year and down from 5.9 percent in November (it had been forecast to hold steady at 5.9 percent).
Non-farm payrolls in December increased by just 1,000, after a downwardly revised rise of 43,000 in November. It was the fifth consecutive monthly climb (but was far below economist expectations for a rise of 130,000.)
309,000 people dropped out of the work force, for a total of 433,000 “discouraged” workers in December who were not looking for work because they believed no jobs were available, up from 403,000 a year ago.
Retailers cut payrolls by 38,000, which the department said was caused by general merchandise stores taking on fewer workers than usual.
The troubled manufacturing sector failed to break its job-cutting trend, shedding 26,000 jobs in December, the 41st month of declines.
Now the spin:
The poor report is a headache for President Bush as he seeks re-election in November with the economy — specifically job creation — expected to be a key issue in the campaign.Sphere: Related ContentBut Bush, speaking to a small business forum, was upbeat, saying all economic signs were “very strong.” He said the drop in the unemployment rate was a “positive sign” of an improving economy.
Economists disagreed.
“It’s a shocker. The one ray of sunshine, the decline in the unemployment rate, is ironically a sign of weakness,” said Cary Leahey, senior U.S. economist, Deutsche Bank Securities, New York.
“The only reason it declined is that fewer people were looking for jobs in December.” . . .
Democrats seized the opportunity to criticize Bush’s record on the economy. “I think it’s time that George W. Bush loses his job so that we can put the American people back to work,” said Democratic presidential hopeful Wesley Clark. . . .
Economists say productivity gains have helped speed up economic growth but allow companies to raise output without creating new jobs.
One bright spot in the report was hiring in construction, which was up 14,000. The building industry has boomed as low mortgage rates have fueled home buying.
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