IBJNews

U.S. unemployment rate dips despite weak jobs report

Back to TopCommentsE-mailPrintBookmark and Share

U.S. employers added 96,000 jobs last month, a weak figure that could slow any momentum President Barack Obama hoped to gain from his speech to the Democratic National Convention.

The unemployment rate fell to 8.1 percent from 8.3 percent in July, the Labor Department said Friday. But that was only because more people gave up looking for work. The government only counts people as unemployed if they are actively searching.

The government also said 41,000 fewer jobs were created in July and June than first estimated. The economy has added just 139,000 jobs a month since the beginning of the year, below 2011's average of 153,000.

Dow Jones industrial futures, which had been up before the report, fell soon after it was released.

The report was weak throughout. Hourly pay fell, manufacturers cut the most jobs in two years and the number of people in the work force dropped to its lowest level in 31 years.

Sluggish hiring could nudge the Federal Reserve to announce some new action to boost growth after its meeting next week.

The report on hiring and unemployment is among the most politically consequential of the campaign. The figures arrive just as the presidential race enters its final stretch. Jobs are the core issue, and the report could sway some undecided voters.

There will be two additional employment reports before Election Day Nov. 6. But by then, more Americans will have made up their minds.

In his speech Thursday night, Obama acknowledged incomplete progress in repairing the still-struggling economy and asked voters to remain patient.

"The truth is, it will take more than a few years for us to solve challenges that have built up over the decades," Obama said.

In addition to those who've given up looking for work, many young Americans are avoiding the job market by remaining in school. All told, the proportion of the population that is either working or looking for work fell to 63.5 percent. That's the lowest level in 31 years for the labor force participation rate.

Average hourly wages dipped a penny to $23.52 and are only slightly ahead of inflation in the past year.

The average work week was unchanged in August after being revised downward in July to 34.4 hours. And the number of temporary jobs fell for the first time in five months. Both figures suggest that companies are seeing less demand for their services and need fewer workers.

Many of the jobs were in lower-paying industries such as retail, which added 6,100 jobs, and hotels, restaurants and other leisure industries, which gained 34,000. Higher-paying manufacturing jobs fell by 15,000, the most in two years.

The weak pace of hiring is the latest sign that businesses are reluctant to make big investments or add more workers. Europe's financial crisis has pushed the region's economy to the edge of recession. And a set of tax hikes and spending cuts scheduled to take effect at the beginning of the year have created uncertainty about future growth.

ADVERTISEMENT

  • 5-Point Plan
    That's right, Romney has a 5-point plan for instant turnaround...no one can name any of the 5 points, but he has a plan. Vote for him and he'll let you know what it is.
  • How could this be?
    How could this recovery possibly be slowing. When we have a combination of the saviour and King Arthur as a president. This looks like despair and nothing changing. VOTE REPUBLICAN and I'll wager that this turns around (in less than 4 years) yeah, I know Obama and whining democrats---it's going to take more time. Vote Republican and see (no it doesn't, with a plan it can be fixed in less than 4)

    Post a comment to this story

    COMMENTS POLICY
    We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
     
    You are legally responsible for what you post and your anonymity is not guaranteed.
     
    Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
     
    No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
     
    We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
     

    Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

    Sponsored by
    ADVERTISEMENT

    facebook - twitter on Facebook & Twitter

    Follow on TwitterFollow IBJ on Facebook:
    Follow on TwitterFollow IBJ's Tweets on these topics:
     
    Subscribe to IBJ
    1. I had read earlier this spring that Noodles & Co was going to open in the Fishers Marketplace (which is SR 37 and 131st St, not 141st St, just FYI). Any word on that? Also, do you happen to know what is being built in Carmel at Pennsylvania and Old Meridian? May just be an office building but I'm not sure.

    2. I'm sorry, but you are flat out wrong. There are few tracks in the world with the history of IMS and probably NO OTHER as widely known and recognized. I don't care what you think about the stat of Indy Car racing, these are pretty hard things to dispute.

    3. Also wondering if there is an update on the Brockway Pub-Danny Boy restaurant/taproom that was planned for the village as well?

    4. Why does the majority get to trample on the rights of the minority? You do realize that banning gay marriage does not rid the world of gay people, right? They are still going to be around and they are still going to continue to exist. The best way to get it all out of the spotlight? LEGALIZE IT! If gay marriage is legal, they will get to stop trying to push for it and you will get to stop seeing it all over the news. Why do Christians get to decide what is moral?? Why do you get to push your religion on others? How would legalizing gay marriage expose their lifestyle to your children? By the way, their lifestyle is going to continue whether gay marriage is legalized or not. It's been legal in Canada for quite a while now and they seem to be doing just fine. What about actual rules handed down by God? What about not working on Sundays? What about obeying your parents? What about adultery? These are in the 10 Commandments, the most important of God's rules. Yet they are all perfectly legal. What about divorce? Only God is allowed to dissolve a marriage so why don't you work hard to get divorce banned? Why do you get to pick and choose the parts of the Bible you care about?

    5. Look at the bright side. With the new Lowe's call center, that means 1000 jobs at $10 bucks an hour. IMS has to be drooling over all that disposable income. If those employees can save all their extra money after bills, in five years they can go to the race LIVE. Can you say attendance boost?

    ADVERTISEMENT