The U.S. economy barely added jobs for the second month in a row in June and the unemployment rate rose to the highest level this year, adding to concerns the labor market will take years to recover.
Nonfarm payrolls rose 18,000 last month, far less than expected, as small gains in the private sector were just enough to outweigh continued government-job losses, the Labor Department said Friday in its survey of employers. Payrolls data for the previous two months were revised down by a total 44,000 to show increases of only 25,000 jobs in May and 217,000 in April.
The jobless rate, which is obtained from a separate household survey, increased for the third straight month to 9.2% in June from 9.1% in May. It was the highest level since December 2010. There are 14.1 million Americans who would like to work but can’t get a job.
Last month (May) almost 90% of the jobs created were in Texas and Florida–right to work, very low corporate tax rate, no individual income tax. Just a coincidence I’m sure.
Leading cause of low employment right now is almost complete lack of new construction. This is a result of the burst of the housing bubble and the presence of excess inventory of commercial real estate. This won’t end until people feel confident enough to start building new houses and companies start expanding to the point that they need new real estate. Minimum wage jobs in Texas and Florida are not going to get this country back on track.
I respectfully disagree that the construction sector is completely to blame. I think the biggest drag on the economy is the rampant uncertainty.
Are the budget problems going to get fixed? Are there going to be big new taxes?
These are the issues suppressing investment.
For a very interesting take on how housing helped collapse the economy read the [url=”http://www.nytimes.com/2011/05/29/books/review/book-review-reckless-endangerment-by-gretchen-morgenson-and-joshua-rosner.html?_r=1&pagewanted=2″]Sunday NYT Book Review article[/url] by Robert Reich (hardly a conservative) where he reviews the new book “Reckless Endangerment – How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.” Just so you don’t get the idea it’s some conservative hit piece, the primary author is a NYT reporter.
[i]Leading cause of low employment right now is almost complete lack of new construction[/i]
Let’s assume for a second that this does have an effect on the stagnant jobs situation. What is our Federal Government doing to help fix this? Why, we are going to force the mortgage market to wait a full year before taking houses through the foreclosure process
http://blogs.wsj.com/developments/2011/07/07/mortgage-aid-for-unemployed-expanded/
What does this do? Well it extends the current glut of inventory by not letting the system quickly digest that inventory, create new house owners, and then let the housing market recover to historic levels of replenishment to service the demand that will reappear when the economy does recover. What else is the Federal Government doing?
http://www.realclearpolitics.com/video/2010/02/25/pelosi_health_reform_will_create_400000_jobs_almost_immediately.html
Oh yeah, how is that working out for us?
I’m with Random Joe — all around me are business people, vendors, and then my clients. All of us talk, and I and others pound on not adding overhead or expenses during this uncertain time — and the biggest overhead is hiring.
Don’t hire — work 80-90 hour weeks to keep up and try to set aside some money for the upcoming horrific expenses. But for heaven’s sake don’t hire.
No. 5: “But for heaven’s sake don’t hire.”
Yes, my sense too. And Obama doesn’t inspire confidence in employers.
We must already have–but we really need to front-and-center–a national job bank or job inventory that locates jobs like parking spots. I walk to work and see eager or at least energetic grounds workers swarming all over the place. I look at young men I know who barely made it thru high school and yet they’re doing very well in the South in air conditioning. I don’t mean sitting on the sofa sipping a cold one. I mean working hard in HVAC. Why–how–have they made it? We’re not seeing much analysis or discussion of that in the national media.
FT’s Alphaville–“A disastrous report, with not a single piece of good news that we can discern.”
Ugh.
we are bearing the fruits of electing an empty suit…..
And this is not just about numbers: real people’s lives are being crushed by this. Dreams are going up in smoke. Honest, hard working people are losing jobs, homes, through no fault of their own. The devestation in the private sector has been severe, while governmental employment at state levels has held firm and Federal employment has actually increased. I have not seen a recent figure for the percentage of new college grads without job offers but have a couple in our extended family who graduated this spring and have not landed a single interview. This is really starting to look like the lost decade in Japan and it just doesn’t have to be that way.
#1: There are jobs being added in, I guess, no-right-to-work states, [url=http://www.bls.gov/news.release/laus.nr0.htm]too[/url]. Perhaps Texas alone “throws the curve” in the statistics because of the jump in the price of oil. Some friends of mine have ridden that roller-coaster. The pay is great while it lasts, just don’t spend it all on beer.
when we extended the unemployment benefits we then needed to recover those costs from employers. We have one layoff on our record. For the remaining employees we pay 13 1/2% of their salary (through – I think – the first $8500). The rate was 3% a few years ago. So any new employee costs an additional $1000 to hire (as did every existing employee). Why not waive the unemployment tax on new hires – seems like it would be a win – win. The governemnt stops paying out and the employee gets a job. By the way – they also say summer employment is down – this is a big reason.
For 50+ years, we- – the American middle class – – have obtained, and used, credit carde after credit card. When one maxed out, we used others to pay it off, and so on. For 50+ years, we came out of school, got married, and our “starter house” has been 2400 square feet, with a 3-car garage (the Beamer gets the center We are going to pay it, one way or another.
The only problem that I have with “don’t hire” is what to tell people who have re-trained from job to job…….as they lose one job, only to re-train for another and lose that job, too. How do they support themselves and their families? What do you tell someone who’s looking for a job…..any job…..but can’t get that job because he or she has no experience? How are they supposed to get that experience if someone won’t take a chance and hire them in the first place? No employer has ever answered that question. Everyone has to start somewhere.
According to the Department of Labor the private sector actually added jobs in the period that was just reported on. The awful jobs numbers (according to the DoL) are the result of massive losses of government jobs.
That may be, but here in Merced County, California, most of the job losses have been in the private sector, and the chances of new hires happening anytime soon are slim to none.