Friday, March 9, 2012

Who says there are no jobs being created...US economy adds 227,000 jobs in February

The US economy created 227,000 jobs in February, while the unemployment rate stayed at 8.3%, the lowest level in nearly three years.

President Barack Obama says he is confident
there are "better days ahead" for the US economy

The Labor Department report also showed that job-creation figures in December and January were even stronger than first estimated.  President Barack Obama said the figures showed the economy "getting stronger".  Employment has been rising for the past six months, but the jobless rate has been stuck above 8% since early 2009.

That, largely, can be explained by the changing size of the workforce.  Americans who had given up looking for work have started streaming back into the labour market.

Those who re-enter the market but do not secure jobs are in effect counted afresh as unemployed.

That's why the unemployment rate in February remained unchanged at 8.3%.

The American economy, it seems, is lumbering out of recession's shadow. These numbers are very good for President Obama's reelection chances. But we have been here before. In the last couple of years, surges of economic activity have simply withered away.

Economists warn the same could still happen this time. The cost of fuel is worryingly high, and may prove a drag on growth.  The Republicans who seek the presidency this year pour scorn on Mr Obama's handling of the economy. And that message resonates among millions of desperate Americans. But if the economy continues to improve, the Republican position will begin to look a little thin come November.

And Mr Obama's approval ratings are ticking upwards. They hover around 50% now, showing that, as America's economy slowly improves, the president undergoes a political recovery of his own - but the two remain equally tentative.

The number of new jobs being created has been consistently above 200,000 in each of the past three months, fuelling hopes that the US recovery is gathering pace.

"Our job now is to keep this economic engine churning. We can't go back to the same policies that got us into this mess," Mr Obama said at a Rolls Royce plant in Virginia, insisting that better times lay ahead.

"We can't go back to an economy that was weakened by outsourcing and bad debt and phoney financial profits."

Earlier, the head of the International Monetary Fund, Christine Lagarde, said the US may exceed a previous forecast of 1.8% growth in 2012.

On Friday, new figures showed the US trade deficit higher than expected in January.

High oil prices and renewed demand helped to push imports to a record high of $233.4bn, according to the Department of Commerce, with imports from China rising 4.7% to $34.4bn.

The trade gap was $52.6bn in January, the highest since October 2008, and its estimate of December's trade deficit was revised up to to $50.4bn from a previous figure of $48.8bn.


Employment in February rose in professional and businesses services by 82,000, with half of that in temporary help services.

Jobs growth also occurred in health care and social assistance, leisure and hospitality, manufacturing, and mining.
Manufacturing added 31,000 jobs, with most car makers been taking on new workers and adding shifts and overtime to meet pent-up demand after production was disrupted early last year following the tsunami and earthquake in Japan.

Lock employee in Milwaukee, Wisconsin, on 25 January 2012
Job-creation has been a major issue on the US
eletion campaign trail
Another positive note was provided by a revision to data showing that the economy had created 61,000 more jobs in December and January combined than was previously estimated.

Paul Ashworth, chief US economist at Capital Economics, said the figures added to evidence that the US jobs market had turned a corner: "Overall, another very strong payroll report and there's every chance that March will bring more of the same."

The number of people without a job remained all but unchanged last month, at 12.8 million, and the number of those working part time because their hours have been cut back or because they have been unable to find a full-time job was also stuck at 8.1 million.

Unemployment is one of the most hotly contested topics among the candidates battling to win November's presidential election.

An improvement in the figures is seen as favourable to the incumbent, President Barack Obama.

BBC News Business

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