July 6 - The U.S. labor market stalls in June with paltry job creation and an unemployment rate stuck at or above 8 percent for 3-1/2 years. Conway G. Gittens reports.
June was another disappointing month for American job seekers. Employers added just 80,000 jobs in June, below the 90,000 Wall Street was expecting. The only slight comfort was the pace of hiring picked up slightly from the month before. But that's still not enough to move the unemployment rate which held steady at 8.2 percent. It's now been 41 months since the jobless rate has stayed above 8 percent. A rise in the category the Labor Department calls not-temporary unemployment is troubling and signals a bigger problem for the economy, explains Fact and Opinion Chief Economist Bob Brusca. SOUNDBITE: ROBERT BRUSCA, CHIEF ECONOMST, FACT AND OPINION ECONOMICS (ENGLISH) SAYING: "You've become unemployed and you're not waiting to go back. Your firm doesn't exist. It went out of business. They closed the plant. They eliminate the shift. You are just out of a job and you have to come up with something completely different to do, that kind of unemployment is raising the unemployment rate by over two percentage points in this cycle, compared to the average in past cycles. It's a huge increase and it really illustrates that what we have is a structural problem." A structural problem that has not been fixed by the Federal Reserve pushing interest rates near zero or trying out many different ways to get the economy going again. SOUNDBITE: ROBERT BRUSCA, CHIEF ECONOMST, FACT AND OPINION ECONOMICS (ENGLISH) SAYING: "You are not just going to drive the economy harder and put these people back to work. You need to do something. You need policies to target regions. You need to retrain workers. You really need to do something. You need to give firms for example some subsidies to hire and retrain workers so that they can have jobs. Making the economy grow faster isn't going to do it." A message the nearly 13 million unemployed Americans hope is being heard loud and clear in Washington. Conway Gittens, Reuters