Published: Friday August 6, 2010
The US economy shed a worse-than-expected 131,000 jobs in July, the Labor Department said Friday, as the unemployment rate remained stuck at
The private sector was unable to offset a massive government layoff of 143,000 census-takers, with firms creating 71,000 jobs in the month, department figures showed.
The figures were seen as yet another sign that the US economic recovery is stagnating (a better word would be "mythical"--jef).
Analysts had predicted the ranks of working Americans would shrink by around 87,000, helping to push the unemployment rate (based only on those receiving unemployment benefits; not including those who don't receive benefits--jef) up to 9.6 percent.
For months investors have anxiously awaited any clue of where the economy is headed, with data frequently providing a confused snap shot.
That trend appears to have continued, leaving policy makers -- including President Barack Obama -- now facing tough choices about whether further crisis measures are needed.
"The modest gain in private sector jobs confirm that the economy remains on a slow growth path, and it's going to be a long haul to rev up the jobs machine," said Bart van Ark, chief economist of The Conference Board, a business research firm.
"The current pace of employment is too slow to replace the more than 8 million jobs lost in the recession -- not in the next year or two, perhaps even not in the next five years."
The Federal Reserve's rate-setting panel meets on Tuesday, when it is expected to discuss restarting stimulus policies.
But most analysts agree the central bank will shy away from any new measures unless absolutely necessary, to avoid using one of their few remaining policy levers.
"The central bank's problem now is that any additional monetary stimulus will require unconventional methods," said Ryan Sweet of Moody's Economy.com "and the cost and benefit trade-off of these are unclear."
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