Posted on Fri, Oct. 07, 2011
last updated: October 07, 2011 05:05:22 PM
WASHINGTON — Employers added a better-than-expected 103,000 jobs in September, the government said Friday, in a report that provided relief from the economy's summer-time blues by also revising sharply upward tepid hiring numbers from July and August.
Most mainstream analysts had expected hiring in the range of 25,000 to 70,000, but September hiring was even stronger. Private sector hiring stood at 137,000 and was dragged down by the 35,000 government jobs lost during the month.
While welcome, the positive numbers Friday were below the 150,000 a month rate needed to keep pace with new entries into the workforce. Thats why the unemployment rate remained unchanged, at 9.1 percent, from August and why measures of underemployment remain elevated.
This was a good jobs report, albeit relative to much diminished expectations and not good enough to bring down unemployment. It is encouraging that businesses are still adding to payrolls, which is strong evidence that the economy continues to grow and is not in recession, said Mark Zandi, chief economist with Moodys Analytics. With the increase of hours worked and wages, personal incomes rose solidly and will provide enough financial fuel to consumers as the key Christmas buying season approaches.
There were plenty of good signs in the latest jobs report. Zandi alluded to one with personal income rising, which showed average hourly earnings rising 0.2 percent during the month. For the year, hourly earnings have risen by almost 2 percentage points.
Temporary hiring increased by almost 20,000 jobs, and that is usually a springboard for future full-time jobs as employers test the waters. And there were 48,000 new hires in the broad category of professional and business services, which captures much of the white-collar employment, where salaries are stronger and often translate into consumer spending.
The economy appears to have taken a step back from recession, Zandi said.
One additional confirmation of that view came from the revisions to data for previous months. The initial August jobs report showed no net new hiring, literally zero growth. That was revised upwards by 57,000 jobs on Friday, suggesting August wasnt as horrible as thought. July numbers were also revised upward by 42,000 jobs.
There were down notes. Manufacturers, who had been adding jobs for much of the year, trimmed payrolls by 13,600 in September. The financial sector shed another 8,000 jobs and government layoffs continue to hurt the overall jobs picture, with almost all of the 35,000 job losses coming from cash-strapped local governments that are struggling to provide essential citizen services.
Also troubling in the latest jobs report were the alternative measures of employment — often referred to as underemployment. The number of people employed in part-time work for economic reasons — meaning they want full-time work but cant find it — rose to 9.3 million in September. The number of workers marginally attached to the workforce — who would look if employment prospects picked up — was 2.5 million, the same number as a year earlier.
And the number of Americans out of work for six months or longer, crept up to 6.2 million. They accounted for 44.6 percent of the jobless in September. Amid a bitter presidential campaign and bipartisan rancor, Democrats and Republicans each used Fridays report to try to score political points.
The American people are asking the question: Where are the jobs? The Democrats running Washington need to stop campaigning, start listening, and start working with Republicans to liberate our struggling economy and remove government barriers to private-sector job growth, House Speaker John Boehner, R-Ohio, said in a statement just five minutes after release of the jobs report.
The White House used the report to paint a rosier picture.
Despite a slowdown in economic growth from substantial headwinds experienced throughout the year, the economy has added private sector jobs for 19 straight months, for a total of 2.6 million jobs over that period, Katherine Abraham, a member of the presidents Council of Economic Advisers, said in a statement.
Appearing on the CNBC cable channel an hour after the jobs report was made public, the head of the administrations National Economic Council, Gene Sperling, said the numbers underscore the need to take out an insurance policy in the form of the presidents proposed jobs plan.
We need to have more robust job growth, he said, criticizing Republicans for offering no alternative for creating jobs and offering proposals whose benefits would be felt years out.
The U.S. Chamber of Commerce, which has criticized the administration on regulatory and tax matters, gave a tongue-in-cheek welcome to Fridays numbers.
The jobs report this month provides a bit of good news but its kind of like pulling a tie out of a game you thought you were losing, Martin Regalia, the chambers chief economist, wrote in an analysis of the jobs report.