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. Job loss has been more than what was expected. In July alone, 71,000 jobs were created while 131,000 were lost. As the lowest edition of the year, manufacturing added 36,000 new jobs. Average hourly earnings increased, average hours worked rose and productivity increased. Hiring has stopped because productivity is doing so well.
Waiting for unemployment rate to get out of limbo
Companies within the U.S. added workers in July for a seventh straight month. The number of jobs being gained every month is 100,000 despite the fact that that is not enough to balance the amount being lost each month which is more than that, reports the Wall Street Journal. The number of jobs accessible in June went down also. 125,000 more than reported before, jobs went down 221,000 that month. Only 31,000 jobs were added to the private sector in June. 131,000 jobs were lost in July rather than the 60,000 expected to be lost by Dow Jones Newswires.
Everyone employed is glad
July’s jobs report did contain a few bright spots. Daily Finance reports the average workweek increased by 0.1 hours to 34.2 hours. Average hourly earnings increased 4 cents to $ 22.59 per hour. The last 12 months has a 3 percent increase in productivity when in the first quarter of 2010, the increase was 4 percent. Higher U.S. productivity is boosting corporate earnings. Companies are sitting on huge piles of cash. High productivity and more efficient business models are good for stock prices, but that means many companies do not feel they have to hire more workers.
Unemployment problems for the Federal Reserve
The unemployment rate will be changed depending on what the jobs report influences the Federal Reserve to do. Reserve deposit rates might drop passed the 0.25 percent rate as a possible solution, reports Bloomberg in an interview with Fed chairman Ben Bernanke. The Fed has about $ 2.3 trillion in assets, although another option could be to expand those assets to hold down borrowing costs.
Americans at odds with themselves about unemployment
Considering how there is so much good and bad within the jobs reports, public opinion has done the same thing. More than seven in 10 Americans say the U.S. economy is nevertheless mired in recession, according to 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
