It's Jobs Stupid. 2.6 million new jobs in 2004? Got a long way to go then!

[Rdskns2000]

As long as people feel secure and baring another terrorist attack; the state of the job market is what will determine this election.


>>>>February Job Growth Surprisingly Weak
By Tim Ahmann, Reuters


WASHINGTON (March 5) - The nation's added a paltry 21,000 jobs last month, according to a surprisingly weak government report Friday that turned up the heat on President Bush as he seeks re-election.

The Labor Department report was the latest to dash hopes that employment was following the rest of the economy higher, leaving some economists to warn that robust hiring may still be some way off.

''The job market is stuck in a cycle of inertia,'' said John Challenger, head of the outplacement firm Challenger, Gray & Christmas. ''The fact is, we are going to have to get used to slow job creation in this country.''

Details in the report were as bleak as the headline figure. Private-sector employment was actually unchanged in February, while the government added 21,000 workers.

It also showed job creation in December and January was weaker than previously thought. The count of job gains for January was revised to 97,000 from 112,000 and for December to just 8,000 from 16,000.

February's unemployment rate held at 5.6 percent, but only because people dropped out of the labor force. Employment as measured by a survey of households actually plummeted.


Chris Low, chief economist at FTN Financial, described it as an ''unambiguously ugly report''. Wall Street firms had forecast a February gain of 125,000 jobs and the market reaction was swift and sharp.

The dollar weakened and U.S. Treasury bond prices shot up, sending interest rates down, on the view the Federal Reserve would hold borrowing costs steady for a long while.

Expectations of steady rates helped support stocks, which turned up modestly in early trade after dipping at the open.

''This is a terribly disappointing report,'' said Joel Naroff of Naroff Economic Advisors in Holland, Pennsylvania. ''The economy clearly needs to see better job growth to support consumer spending.''

The political reaction was swift as well.

''At this rate the Bush administration won't create its first job for another 10 years,'' Democratic presidential candidate John Kerry said in a written statement.

Democrats have repeatedly criticized Bush for presiding over the weakest period of jobs creation for any president since Herbert Hoover during the Great Depression. Since he took office, 2.2 million jobs have vanished.


The Bush administration released a forecast last month that looked for average growth of about 300,000 jobs a month this year -- well above most private forecasts. But with each disappointing employment report, that projection looks increasingly pie-in-the-sky.

Administration officials said Kerry's economic prescription of rolling back tax cuts for the wealthy was wrong-headed, contending that the weak labor market made it all the more vital to cut business costs and keep tax cuts from expiring.

''The numbers suggest we need to keep the economy growing and reinforce our view that it would be a terrible mistake to raise taxes on American families and American businesses that are working to create jobs,'' Treasury Secretary John Snow said.

An average of just 42,000 jobs have been created each month in the last three months, down from the 79,000 average of the prior three months. Economists say gains near 150,000 are needed each month just to keep pace with labor force growth.

In addition, the average length of time workers who had lost jobs stayed unemployed climbed to 20.3 weeks in February, the longest period since January 1984.

Construction employment tumbled by 24,000 in February, while the factory sector shed 3,000 workers, the 43rd straight monthly drop. The service sector also proved unexpected weak, creating just 46,000 new positions.

Economists were hard-pressed to explain why job growth had fallen so far short of expectations, although some said poor weather ahead of the week in which the Labor Department surveyed businesses may have played a role.

For the most part they pinned the weakness on the ability of businesses to boost output without taking on new workers.

''At this time in the cycle, businesses are extremely cautious about hiring, and they are extremely focused on productivity gains,'' said Kurt Karl, chief economist at Swiss Re in New York.

Some economists warned consumer spending could falter later in the year, once a boost from big tax refunds pass, if job creation does not pick up more smartly.

Many economists and Fed officials believe productivity gains will slow soon, leading to more hiring. But expectations for bigger employment gains have been repeatedly dashed.

Analysts say the Fed needs to see more robust jobs creation before bumping up overnight interest rates from their current 1958 low of 1 percent -- a level officials have warned cannot be maintained forever.<<<

[jbooma]

there is nothing wrong with a 5.6 unemployment rate, and february is normally a slow month in regards to hiring anyway

[flashback]

In my mind, 5% unemployment is more or less ideal. You've got to have a little bit of the labor force available to avoid wage/price inflation. Also, it allows companies to increase productivity by finding more qualified employees. The bit about people dropping out of the labor force is a little more disturbing. What are they doing instead? I think our crime numbers may be about to go up.

The big problem for the Bushies is that they said there would be 300,000 jobs created in February, so they were off by 279,000. So, I think that means they were off by 1,428.57%. That's pretty bad forecasting, Mr. Snow.

BTW, my dad lost his job about a week ago, due to the scaling down of Naval operations overseas. I won't be sad to have him back home, but it's going to be tough for a 58 year old in this environment.

[jbooma]

Originally posted by flashback
In my mind, 5% unemployment is more or less ideal.

Honestly I don't we will ever see 5% again. As long as the number is below 6 the job market is fine.

[Chief skin]

Different story if you are one of the 5%

[endzone_dave]

5.6% doesn't even count the number of people who gave up looking.

If the numbers don't start getting better, Bush is toast, IMHO.

[Mad Mike]

You want to see a real loss of jobs? Let Al Quada hit us again.

NOTHING ELSE MATTERS.

[Ghost of Nibbs McPimpin]

It's always bad if you're one of the unemployed or underemployed like me

Fact is, only a damn fascist or Communist is relying on the President to "run" the market. The market is a collection of millions, billions really on a world scale, of individuals and individual organizations and then networks of organizations making decisions with imperfect information(as they must.)

I wish government would extricate itself from business as much as possible. Then business and lobbyists would have less reason to exert influence in the halls of power.

The idea of a president with the levers of the economy-machine at his desk is one believed by the retarded and otherwise mentally disabled.

[Ignatius J.]

What Buisnesses is the government in?

I tend to agree with the ghost. Get out as much as possible. Tariffs, Subsidies, etc. But the government does need to tax, and taxing effects businessess too. I suppose you just pray that you get the most equitable distribution possible so that each business pays it's fair share....

tough to do. any method you devise will favor some businesses and kill others. Although, the market will adjust to cover some of that, as long as attempt is made at equalization.

Even in the best case, we're still a long way from a totally FREE market.

and that's not neccesarily a bad thing.

-DB

[Destino]

Bush shot himself in the foot on this issue. Had he given a gloomy outlook that the economy would exceed (like Clinton used to do) then he would be lifted up as a success. But instead he put out a overly positive estimate to silence the nay sayers in the short term and now is failing to meet it.

[Rdskns2000]

Originally posted by Mad Mike
You want to see a real loss of jobs? Let Al Quada hit us again.

NOTHING ELSE MATTERS.

If your not employed at the time your are voting; that will be your #1 concern. Key states like here in Ohio are still losing manufacturing jobs.


Joe unemployed will be more concerned with a job; than whether some al queda terrorist will blow them up.


Since their hasn't been another terrorist attack on American soil; terrorism is down the list. Come election day, if their hasn't been another terrorist attack; people will feel secure and focus on other issues.


In key election states. If there hasn't been a turnaround from job losses to job creation; Bush is in trouble. The national employment rate may not be that bad but in the local precinct; the state of the job market matters.


Right now if the election were held today; Bush would lose. Of course the election isn't today. So, Bush teams initial, since retracted, predictions could come true.