The latest jobs report detailing the U.S. unemployment rate for July reflects the ongoing battle between the bad news and also the good news. Unemployment has been at 9.5 percent for a while. More jobs have been lost than was expected by experts. In July alone, 71,000 jobs were created when 131,000 were lost. 36,000 jobs were added by manufacturing although that was the lowest addition this year. More money was made by individuals working more hours which increased probability. But increasing productivity is one more factor holding back hiring.
Waiting for unemployment rate to get out of limbo
More workers were added to companies in July. The number of jobs being gained every month is 100,000 despite the fact that that isn’t really enough to balance the amount being lost each month which is more than that, reports the Wall Street Journal. June reports showed a downward pull. 221,000 jobs a month were reported to be lost in June, which is 125,000 more than before. Only 31,000 jobs were added to the private sector in June. The Dow Jones Newswires were expecting a 60,000 job loss in July, which really ended up being 131,000.
Everyone employed is glad
July’s jobs report did contain a couple of bright spots. The average workweek went up from 0.1 hours a week to 34.2 hours, reports Daily Finance. Average hourly earnings increased 4 cents to $ 22.59 per hour. The last 12 months has a 3 percent increase in productivity when within the first quarter of 2010, the increase was 4 percent. Higher U.S. productivity is boosting corporate earnings. Money sitting around is pretty normal right about now for companies. Stock prices are doing better with this productivity and efficiency, which means companies do not want more workers.
Unemployment issues for the Federal Reserve
The unemployment rate can be changed based on what the jobs report influences the Federal Reserve to do. Fed chairman Ben Bernanke told Bloomberg that a possible solution can be reducing the rate of 0.25 on reserve deposits. One more choice might be to help hold down borrowing costs by getting more assets although the Fed already has a $ 2.3 trillion balance sheet.
Numerous Americans hurt by unemployment
Considering how there is so much good and bad in the jobs reports, public opinion has done the same thing. The U.S. is nevertheless considered in a recession when asking seven out of ten people in a Bloomberg National Poll. Seven of 10 Americans also said reducing unemployment is the government’s top priority. But more than half are skeptical of the stimulus program and wary of more spending.
Further reading
Wall Street Journal
online.wsj.com/article/SB10001424052748703309704575412990024153682.html?mod=googlenews_wsj
Daily Finance
dailyfinance.com/story/careers/july-jobs-report-unemployment-remains-high/19583596/
Bloomberg
bloomberg.com/news/2010-08-06/company-payrolls-rose-by-71-000-in-july-u-s-jobless-rate-9-5-.html
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