Jobs Numbers Paint 'Very Gloomy' Picture For All

Sep 3, 2011
Originally published on September 3, 2011 8:56 am

President Obama is set to deliver a major speech on jobs next Thursday, and his task will be even more challenging after Friday's monthly government jobs report. The U.S. Labor Department says there was no job growth for the first time in a year, and unemployment was unimproved, staying at 9.1 percent.

NPR's Scott Horsley tells Weekend Edition host Scott Simon some jobs were added, but not enough to make up for other losses.

"Private employers did add some workers to their payrolls — some 17,000 of them across the country, but those gains were completely offset by cutbacks on the government side," he says. "Making matters worse, the already lackluster job gains we thought we'd seen in June and July were revised downward by nearly 60,000 workers."

While the word "recession" is one that comes up, the country is technically not there yet, Horsley says.

"So far, it does not appear the economy's actually shrinking," he says, "but it's certainly not growing in a healthy way, and in the way that most people care about, which is jobs."

The poor jobs numbers also affect people who are working. Horsley says when this many people are unemployed, pay raises are harder to come by. The average hourly earnings for workers and the average number of hours worked both decreased in August, the Labor Department reports.

"So all in all, this was a very gloomy picture for people who would like to see more money in their paycheck, as well as those who just like to see a paycheck after what for many of them has been many months on the unemployment line," he says.

In his speech, Obama's aides say, the president will present a plan to meaningfully increase job growth over the next 12 to 18 months.

"So that means this is going to be some kind of short-term shot in the arm, and they hope it will be one that actually contains some serious medicine," Horsley says.

All of the details have not been released, but Horsley says the president is likely to call for an extension of the payroll tax cut and more tax incentives for companies that hire new workers. Obama is also expected to talk about increasing funding for public works projects and for training assistance for unemployed workers.

Horsley says the chances of Obama's proposals getting through Congress are "not great." However, there may be certain points of cooperation, including a training program for longtime unemployed workers, which House Republican leader Eric Cantor said Republicans favor.

The president "extended an olive branch" on Friday when he withdrew proposed regulations on smog, Horsley says, "the kind of rule that the GOP likes to say kills jobs."

"So there may be some areas where they can cooperate, but on the whole ... these two parties are very far apart," he says, "and that political polarization is making the economic recovery that much harder."

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SCOTT SIMON, host: This is WEEKEND EDITION from NPR News. I'm Scott Simon. President Barack Obama is set to deliver a major speech on jobs next week. His task will be even more challenging after yesterday's devastating monthly government jobs report. U.S. Labor Department says there was no job growth for the first time in a year - none. And unemployment was unimproved, staying at 9.1 percent. Coming up, we'll hear how the depressed job market is affecting young workers. First, we're joined by NPR's White House correspondent Scott Horsley. Scott, thanks for being with us.

SCOTT HORSLEY: My pleasure.

SIMON: And let's start with those ugly and dispiriting jobs numbers. No net growth in August.

HORSLEY: You said it, Scott. A big goose egg. Now, private employers did add some workers to their payrolls - some 17,000 of them across the country - but those gains were completely offset by cutbacks on the government's side. So, on the whole, the economy added no new jobs in August and we still have millions of unemployed people in the country. Making matters worse, the already lackluster job gains we thought we seen in June and July were revised downward by nearly 60,000 workers.

SIMON: Is anybody talking about a recession?

HORSLEY: Certainly that word is one you're hearing. So far, it does not appear the economy's actually shrinking, but it's certainly not growing in a healthy way and in the way that most people care about, which is jobs. Even the people who are lucky enough to be working aren't going to like this report, because when you have this much slack in the labor market, it's very hard for anyone else to get a pay raise. And indeed, the Labor Department reported that the average hourly earnings for people who were working decreased in August. The average number of hours worked also inched down. So, all in all, this was a very gloomy picture for people who'd like to see more money in their paycheck, as well as those who'd just like to see a paycheck after what for many of them has been many months on the unemployment line.

SIMON: Of course, the president was already set up to give that major speech to the nation and Congress on Thursday. He'll talk about jobs. Any indication about what will be there?

HORSLEY: Well, aides say the president's going to outline a plan to meaningfully increase job growth over the next 12 to 18 months. So, that means this is going to be some kind of short-term shot in the arm and they hope it will be one that actually contains some serious medicine. We don't know what all the details are, but Mr. Obama is likely to call for some extension of the payroll tax cut that was put in place for this year, as well as some additional tax incentives for companies that hire new workers. He'll also talk about increasing federal funding to support public works projects so that unemployed construction crews can go to work repairing roads and bridges and schools and that sort of thing, and some kind of training assistance for people who'd been out of work for a long time.

SIMON: Given the fact that they had a hard time agreeing on a date for the speech, what are the prospects for the president's proposals getting through congress?

HORSLEY: Well, not great. There are some pieces of what he's going to talk about that might get a look. We did hear from House Republican leader Eric Cantor today who said Republicans favor programs to train long-time unemployed workers, like the one in Georgia, so that might be an opportunity for cooperation. Also, President Obama extended an olive branch to Republicans yesterday when he halted some proposed regulations on ozone, the kind of rule that the GOP likes to say kill jobs. So, there may be some areas where they can cooperate. But on the whole, as you say, these two parties are very far apart, and that political polarization is making the economic recovery that much harder.

SIMON: NPR's Scott Horsley. Thanks so much.

HORSLEY: My pleasure. Transcript provided by NPR, Copyright NPR.