With the American economic recovery showing clear signs of slowdown, private employers added 67,000 jobs in August, the U.S. Labor Department said on Friday. The number was more than forecast.
Over all, the nation lost 54,000 jobs in August, the agency said, as state and local governments, many of them grappling with severe budget deficits, cut 10,000 jobs last month. Another 114,000 temporary Census positions also came to an end.
The unemployment rate rose to 9.6% from 9.5% in July.
Economists had forecast that the overall, nonfarm payrolls would decline 105,000 in August, even as private employers added 41,000 jobs.
The numbers for July were also revised, with 54,000 jobs lost, rather than 131,000. And the private sector added 107,000 jobs, rather than 71,000. The overall number in June was revised to a loss of 175,000 jobs from 221,000. Private employment was revised upward to 61,000 in June from 31,000.The total number of unemployed people rose to 14.86 million in August from 14.59 million in July.
President Obama on Monday said his administration was weighing new steps to bolster the economy, but any measures are likely to be small. His options are limited given that Congress has shown little appetite for more spending before the midterm elections in November, in which Republicans are hoping to reclaim both the Senate and the House.
Republicans have said that the unemployment rate remains high because the president’s stimulus spending as well as his overhauls of health care and the financial industry are a drag on the recovery. Mr. Obama and Democrats have been emphasizing that the recovery is moving in the right direction, albeit at a slow pace. The president has chided Senate Republicans for holding up a jobs bill that would offer tax breaks to small businesses and ease credit with a $30-billion U.s. initiative to channel loans through community banks.
In any case, the report on Friday provided the latest evidence that the recovery was proceeding at an uneven pace. Last week, the Commerce Department revised its estimate for growth in the second quarter down to an annual rate of 1.6%, from 2.4%. The consensus on the outlook for the second half of the year is growth of 1.5 to 2.5%, substantially less than what is needed for the recovery to pick up steam.
Earlier this week, the Conference Board released a monthly survey showing that consumer confidence improved slightly in August but indicated that Americans remained apprehensive about the economy and the job market. Other indicators showed that the housing market clearly slowed over the summer and that retail sales were weak in August. The crux of the problem is circular, economists said: consumer demand needs to pick up, but that is largely dependent on whether people have jobs.
And while corporate profits were generally robust in the second quarter, with many companies improving profits by cost-cutting. Outlooks for the rest of the year were tepid.
Many economists have pinned hopes for job creation on manufacturing, but the U.S. Labor Department said that sector lost 27,000 jobs in August. Many economists has forecast an increase of about 10,000 jobs, but the report cited a decline in auto and auto-related jobs.
The average number of hours worked in private sector was stable at 34.2 weeks, the report said. An increase would suggest that employers were asking more from their workers, a sign that could augur well for future hiring.
Average hourly earnings by workers on private payrolls edged up six cents to $22.66 U.S. in August, from $22.60 U.S. in July, the department said.
The number of people out of work for 27 weeks or more declined by 323,000 to 6.2 million in August, from 6.6 million in July, while the median length of unemployment fell to 19.9 weeks in August, from 22.2 weeks in July.
The broadest definition of the unemployment rate, which includes the people who want jobs but did not search, rose to 16.7% in August, compared with 16.5% in July.
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