Good News on Unemployment while Dow Drops Almost 500
Today (8/8/2011) has been a terrible day for stocks; the Dow is down almost 500 points as of 2:22 EST. Are we headed into another financial disaster or recession? With all the doom and gloom, it’s good to hear some good news on the hiring front, even if it is a modest improvement.
The unemployment rate dipped slightly in July to 9.1 percent, the Bureau of Labor Statistics reported in a recent press release. Total private job gains were higher than expected with 154,000 positions created. However, government jobs continued to bleed out with a loss of 37,000 positions. Combined, the total non-farm payroll positions rose by 117,000.
This month’s figures were higher than expected, as economists had initially forecast a much slimmer 90,000 jobs added and an unchanged unemployment rate to rest at 9.2 percent.
“This is encouraging news, but it also shows that we need to keep fighting for what we know has worked throughout this recovery,” said Secretary of Labor Hilda L. Solis in a statement following the report. “That means extending the payroll tax cuts and continuing to support those who are out of work through no fault of their own by extending federal funding for the unemployment insurance system…This month’s report shows yet again that private sector job growth faces difficult headwinds, as job losses in state and local governments continue to hold us back. Budget cuts in state and local government have led to the loss of 340,000 jobs in the last 12 months alone.”
With the continuous slashing of government jobs and the steadily increasing adult population, the current employment gains don’t offer much long term advantage. It’s also important to note that the unemployment rate is potentially higher than it initially appears because individuals might have stopped looking for work altogether. People have to be actively looking for work to be counted as unemployed.
Now that government officials have finished scrambling to solve the debt ceiling crisis, the public’s full attention is back on national unemployment. Linda Solis remarked: “Now that Congress has averted a disastrous default and protected programs that millions of American families count on, it’s critical that our leaders return their focus to job creation.”