Dec 7, 2012 No Comments ›› Pat Dollard
Excerpted from On The Money: The economy added 146,000 jobs in November while the unemployment rate fell to 7.7 percent.
It’s the lowest the jobless rate has been since December 2008, and the report from the Bureau of Labor Statistics was higher than estimates that had predicted Hurricane Sandy would hold total job growth down.
The unemployment rate fell by two-tenths of a point as the labor market pushed through the the storm’s effects, the report said.
The government report showed that despite the storm, Sandy did not “substantively impact the national employment and unemployment estimates for November.”
“While more work remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to heal from the wounds inflicted by the worst downturn since the Great Depression,” said Alan Krueger, chairman of the Council of Economic Advisers.
Employment increased in retail trade, professional and business services, and healthcare.
The approaching holiday season may have boosted November’s figures. Retailers added 53,000 jobs, making up the bulk of the improvement.
There were troublesome signs in the report as well.
Jobs figures were revised down in September to 132,000 from 148,000 an in October from 171,000 to 138,000. Participation in the workforce declined by .2 percent, which suggests underlying weakness in the jobs market.
And the number of long-term unemployed — those out of work for 27 weeks or more — was 4.8 million in November. The rate hasn’t been below 25 percent since March 2009 and has been 40 percent or higher for 34 consecutive months as of September 2012, according to the National Employment Law Project.
Lawmakers are pressing for a yearlong extension of unemployment benefits mostly because the number of long-term unemployed has not dropped, despite the gradual improvement in the labor market.
The report comes as the White House and Congress negotiate a debt deal focused on taxes and spending. President Obama campaign on raising tax rates on household income above $250,000 and has insisted that tax rates on the wealthy rise as part of a deal. Republicans are determined to win significant entitlement reforms in a deal.
Obama has also called for an extension of federal unemployment benefits and new stimulus measures as part of an agreement. Support for those measures could be influenced by the strength of the economy.
If Congress takes no action to prevent scheduled spending cuts and tax hikes in January, economists warn of a new recession.
Business leaders are arguing that hiring will pick up if Congress can reach an agreement on looming tax and spending issues.
Mark Zandi, chief economist with Moody’s Analytics, said he was skeptical that Sandy didn’t affect the November data.
“I suspect that when we get all the data in and get more responses to the survey that BLS conducts that we’ll get a revision down in the data,” he said Thursday on MSNBC.