ECONOMY - Job Market, Good and Bad News

"Jobless Reading Holds Bright Spots, But Many Quit Searching" PBS Newshour Transcript 1/7/2011 (includes video)

Excerpt

JUDY WOODRUFF (Newshour): The U.S. economy added jobs in December, and the unemployment rate dropped. But the newest numbers from the federal Department of Labor also fell short in some important ways.

For American workers, the jobs report was decidedly a good news/bad news story. On unemployment, the good news was, the rate dropped, from 9.8 percent to 9.4 percent. That was the lowest it's been in 19 months. The bad news, the drop was mainly because so many people stopped searching for work, so they were no longer counted as unemployed.

Likewise, on job creation, employers added 103,000 new positions in December, nearly all of them in the private sector. But it takes 125,000 just to meet population growth. The number would have to be twice that large to make a real dent in unemployment.

The chairman of the Federal Reserve Bank, Ben Bernanke, underscored the point at a Senate hearing this morning.

BEN BERNANKE, Federal Reserve chairman: The economic recovery that began a year-and-a-half ago is continuing, although, to date, at a pace that has been insufficient to reduce the rate of unemployment significantly. At this rate of improvement, it could take four to five more years for the job market to normalize fully.

JUDY WOODRUFF: Today's report did show the economy generated 70,000 more jobs than first estimated in October and November. But Bernanke said the large pool of the long-term unemployed remains cause for concern.

BEN BERNANKE: Roughly 40 percent of the unemployed have been out of work for six months or more. Long-term unemployment not only imposes exceptional hardships on the jobless and their families, but it also erodes the skills of those workers and may inflict lasting damage on their employment and earnings prospects.

JUDY WOODRUFF: For his part, President Obama gave an upbeat assessment as he toured a window manufacturing plant in Landover, Maryland, just outside Washington.

U.S. PRESIDENT BARACK OBAMA: The trend is clear. We saw 12 straight months of private sector job growth. That's the first time that's been true since 2006. The economy added 1.3 million jobs last year. And each quarter was stronger than the previous quarter, which means that the pace of hiring is beginning to pick up.