Job Growth In Health, Retail and Manufacturing
RENEE MONTAGNE, host:
This is MORNING EDITION from NPR News. I'm Renee Montagne.
STEVE INSKEEP, host:
And I'm Steve Inskeep.
Rarely has a scrap of middling news sounded so nearly like good news. The Labor Department says the U.S. economy added 117,000 jobs in July. The unemployment rate ticked down a bit, to 9.1 percent. Not so great. But at least there was some relief after the Down Jones 30 Industrials fell more than 500 points yesterday.
We're joined now by NPR business reporter Tamara Keith to walk us through the numbers, what they mean, what's happening. Good morning.
TAMARA KEITH: Good morning.
INSKEEP: So what effect are these numbers having on the markets, first off?
KEITH: Well, futures as soon as the numbers came out, futures were up, and then the markets opened up and then they fell and then we've been sort of bouncing around back and forth, back and forth. Right now we're...
INSKEEP: Down 20, 30, 40, 50 points...
KEITH: Yeah, something in that range. Not significantly down or up. I spoke with analyst Julie Neiman at Smith, Moore and Company in St. Louis. She said at least today's jobs numbers weren't a kick in the shins.
Ms. JULIE MOORE (Smith, Moore and Company): If it's not bad news, that's good news. That's the new Wall Street mantra. The market is basically greeting this as no new fuel on the fire. It didn't hurt. It's not enough for economic recovery, but at least it was in the right direction.
KEITH: And just to dig into the numbers a little bit more - the private sector created 154,000 jobs. There was growth in health care, retail manufacturing. But governments cut jobs again 37,000 jobs were cut. But a lot of that was a result of the government shutdown in Minnesota and therefore temporary.
INSKEEP: Although there's always some temporary factor, it seems. But in this case it could have looked a little better than otherwise it did.
INSKEEP: Nevertheless, as you point out, it is often said you need 200,000, 300,000 jobs a month, net, in order to really make a difference in the unemployment rate. Not there.
KEITH: No, absolutely. If this number had come out three months ago, if we had gotten a number that said 117,000 jobs created, all of the economists and analysts would have been like, oh, you know, that's just not enough, that's not good enough, we're slowing down. Well, we just had two horrible months of job creation, very disappointing. And suddenly after two really disappointing months, a month that ordinarily would have been disappointing, is a relief.
The world on the street today is relief.
INSKEEP: But not like a huge rally in stocks...
KEITH: No, no, no...
INSKEEP: ...just the underlying weakness of the economy here.
KEITH: Absolutely. There are all kinds of things that the markets and frankly everyone else is worried about. You know, the economy in the first half of this year has not been growing very quickly. It at an average annualized rate, it's about one percent growth. That is uncomfortably close to zero growth and has a whole lot of people using that awful, scary term again, double dip recession.
INSKEEP: Now, I want to ask about other factors that might be involved here. We've heard a lot about the European debt crisis. That seems to be weighing on the markets. Also, this is, of course, the week in which a debt ceiling deal was finally concluded by Congress, but only after a terrifying game of chicken that lasted the last couple of months. Is that specter still hanging over the markets in some way?
KEITH: Absolutely. I think what happened was everyone was so incredibly focused on this debt ceiling issue, and in some ways it was a manufactured crisis, and then it ended and everyone went, oh wait, we were just all amped up about this thing, and wait, wait, wait the underlying U.S. economy isn't so hot. And...
INSKEEP: Took a second look at the numbers...
KEITH: Absolutely. And the situation in Europe is concerning to a lot of people, and there are questions you know, I've spoken to traders who say, you know, we're really concerned that neither the leaders in Europe nor the leaders in the U.S. have demonstrated much of an ability to really tackle the big issues like the European debt crisis and the economic and jobs situation here in the U.S.
INSKEEP: So investors are feeling like they're on their own, is what you're saying.
KEITH: Well, they're feeling a bit shaky out there.
INSKEEP: What will you be looking at in the days ahead to understand where things are really headed?
KEITH: Well, you know, every day there's a new economic indicator that comes out, and when those indicators come out, the markets will have another chance to react.
INSKEEP: But we don't have any really clear trends except the recovery seems to be continuing, just not very strongly.
KEITH: Yeah, it's a very slow, painful we're learning that this is going to be glacial.
INSKEEP: Okay, Tamara, thanks very much.
KEITH: Thank you.
INSKEEP: That's NPR's Tamara Keith. And again, the news here, the economy added a net 117,000 jobs in July. Not great, better than expected. Unemployment rate down to 9.1 percent.
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