The unemployment rate actually declined this January from 10 percent to 9.7 percent in December; however, the outlook for jobs still remains bleak. It could possibly weaken again if consumers keep a lid on spending.
A Labor Department survey of households found that 541,000 more Americans had jobs last month. A lot of those jobs were attributed to seasonal adjustments. The 5.7 percent annual growth rate in the fourth quarter was the fastest pace since 2003. A separate survey of businesses found that employers shed 20,000 jobs last month. A report by the Commerce Department however states the strongest evidence to date that the worst recession since the 1930’s ended last year, and still has yet to declare an end to it. But, despite the beleaguered construction industry, the private sector added 63,000 positions.
Growth exceeded expectations because business spending on equipment and software jumped 13.3 percent, better than forecast. It was the second quarter in a row that business spending had increased, which provided an upbeat end to a dismal year. But, economists expect growth to be slow as companies finish restocking their inventories and the government stimulus efforts fade. The growth may not be fast enough to reduce the unemployment rate, and also keep consumers cautious about spending. Without strong consumer spending, the economists worry the recovery could falter.
Actually, the unemployment rate fell to its lowest level since August, chief economist John Silvia states, and that the decline wasn’t a result of a shrinking labor force, which has kept the rate down before. “It simply was, people found jobs,” he said.
The report is “consistent with continued improvement in the labor market.”
But we’re not out of the woods yet. The economy has shed 8.4 million jobs since the downturn began in December 2007, up from a previous figure of 7.2 million. That figure being the most jobs lost in any recession, as a percent of total employment since World War II.
But, we’ve come through recessions before, and the American people are resilient and we will do it again. Just give us the jobs and we will go to work.
Helen L. Price
(Excerpts from the Associated Press)
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