August Jobless Rate Remained 9.1 Percent
STEVE INSKEEP, host:
It's MORNING EDITION from NPR News. Im Steve Inskeep.
We've been waiting for a big number, and this morning we have it. The number is a big zero. That's how many jobs the U.S. economy created in August. None. That's a net number. The Labor Department's monthly jobs report says unemployment remains at 9.1 percent. We're going to talk about the significance of this with NPR's Yuki Noguchi who's covering the story. Yuki, good morning.
YUKI NOGUCHI: Good morning Steve.
INSKEEP: OK. What are the key numbers here? What do they mean?
NOGUCHI: Well, the key number is that goose egg you talked about. The hiring and the firing in the economy all added up to zero. So we're creating as many jobs as we are losing at this point. And it's a real statement of where we are. You know, we're at a complete standstill.
INSKEEP: Now, let me try to figure that out a little bit. When you say creating as many jobs as we're losing, some people take a look at private sector employment, government employment, how does that break down?
NOGUCHI: Well, government employment is still going down. It looked a little bit better this month than it did in previous months, because Minnesota government workers went back to work, from their shutdown. And then private employment looked worse, actually, this month, because Verizon employees were on strike for much of the month, and so those jobs will, sort of, reappear in the following month. But, you know, all of that just sort of cancels out. That's what's interesting.
INSKEEP: And you ended up with the private sector hiring a little bit, government losing, on net, a little bit, and it all balances.
NOGUCHI: It all looks very stagnant.
INSKEEP: OK, so to the extent that there was any hiring in the economy, where did it happen?
NOGUCHI: Well, health care added 30,000 jobs, and the mining industry, apparently, added several thousand. And so, that's your bright spots right there.
INSKEEP: To the extent there are any bight spots. This is a number that's been closely watched for a lot of reasons, one of them being, simply, that there are millions of people out of work. There were 14 million people I gather, still, about 14 million people out of work. Now, of those, how many are long term unemployed as this employment problem stretches in to yet another month?
NOGUCHI: So, that number is largely unchanged, it's six million people. That's more than 40 percent of the jobless are out of work for six months or more. That's not changing. And what's actually changing, is there confidence level is going down. You know, you see consumer confidence surveys that show that, you know, one of the biggest reasons people aren't spending, is because they're worried about their job.
INSKEEP: They're worried, even if they have a job, that they might lose it.
NOGUCHI: Even if they have a job, they're saving more, they're trying to, you know, save for a rainy day.
INSKEEP: Oh, now that's an interesting thing, because in the abstract, we'd like people to save more. Economists consider that, generally, to be a good. But in this circumstance, people, it's feared, are holding back.
NOGUCHI: When you have an economy that is 70 percent driven by consumer spending, saving is not a good thing, especially if you're worried about recession.
INSKEEP: What does this mean for President Obama, who says he is going to lay out a jobs plan next week; and for Republicans who are putting out their plans. It means he has to move a big beast that's not trying to move. I mean, his biggest challenge is that he's tried a bunch of things and, you know, it hasn't showed up in the numbers. So he may talk about some short term fixes, like extending the payroll tax and, you know, extending the unemployment benefits. But these are all just measures that get money to those people, to help, like I said, in the short term.
INSKEEP: People who are already working, basically, if you're payroll tax.
NOGUCHI: People who aren't working, yes. And then, you know, just to keep the economy moving a little bit. But, you know, he also has to think about long term structural issues how do you address those problems?
INSKEEP: One of those structural issues must have to do, at some point, with those millions of long term unemployed. Is there a fear that they just drop out of the workforce permanently at some point.
NOGUCHI: Right, you're seeing that happen. You know, if you look at the last year, the labor force has gone down, which means that, you know, people are sort of dropping out. And part of the worry is that is because they're so discouraged. And so you need address this problem because, uh, you know, economists worry about having a lost generation of workers that are so disconnected from the workforce, that their skills atrophy. And you really you need job retraining, you need education programs to make sure they can re-enter the workforce when the economy comes back.
INSKEEP: Did you say the size of the labor force is going down?
NOGUCHI: Yes. That is that is what's happening.
INSKEEP: Because the population is going up, so this is...
NOGUCHI: The population is going up and the labor force is going down, at the...
INSKEEP: People dropping out, they're not even counted in that 9.1...
NOGUCHI: Right. They're either retiring early or they're going back to school, they're getting discouraged, they're, you know, giving up.
INSKEEP: That's NPR's Yuki Noguchi. Thanks very much.
NOGUCHI: Thank you, Steve. Transcript provided by NPR, Copyright NPR.