What August Job Numbers Mean

The Labor Department reported that the economy added 96,000 jobs in August, far fewer than analysts had predicted. The unemployment rate fell from 8.3 percent to 8.1 percent, an indication that more people moved out of the workforce. Host Michel Martin discusses the latest unemployment numbers with NPR Senior Business Editor Marilyn Geewax.

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MICHEL MARTIN, HOST:

I'm Michel Martin, and this is TELL ME MORE from NPR News. Coming up, we'll talk with one of the speakers who made a splash at the Democratic convention. We'll hear former law student turned activist Sandra Fluke. And we'll hear from a member of Team USA who's competing at the Paralympics in London.

But first, to what both sides agree is the issue in this election, the economy, The latest jobs report is now out, and according to the Labor Department, the U.S. economy added 96,000 jobs last month. The unemployment rate did actually edge down, from 8.3 percent to 8.1 percent, but that seems to be because of all the people who left the labor force or stopped looking.

NPR senior business editor Marilyn Geewax is with us to tell us more. Marilyn, welcome back, thanks for joining us.

MARILYN GEEWAX, BYLINE: Hi, Michel.

MARTIN: So tell us what stands out for you in this latest report.

GEEWAX: The thing that is so clear is that this labor market is just stuck. Every month you hope that this is the month that it'll break out, that we're going to see 200,000, 300,000 jobs. And again and again, all year long, the unemployment rate has been in a very narrow range, from this 8.1 percent, 8.3 percent, just bumps around in there.

Month after month we've been averaging 139,000 new jobs, and that's OK. I mean, it's enough that you could say yes, the job market is growing, but it's not enough when you look at those 12 million people who are still looking for jobs. The growth rate needs to be faster, but at least it has been fairly steady.

MARTIN: Now this week the payroll company ADP estimated that more than 200,000 private-sector jobs were added last month. That's got a lot of people excited, anticipating this jobs report. So why is the Labor Department report so different from what we saw from this payroll company, this private company?

GEEWAX: This is one more good reminder that this is a very large economy. We've got more than 300 million people. You know, it's very tough to measure something as large as the U.S. economy. So you've got different ways at taking a stab at what do we see out there.

ADP measures private payrolls, and they were looking only at the private sector. The Labor Department takes into account a bigger pool of jobs, and we saw that government jobs fell in August. There was a loss of 7,000 jobs just in government.

So all of these things, you know, there will be revisions, there's rounding. You'll never get exactly the right number. But when we step back from all of this data, and we see the year in total, what's clear is that generally speaking, we just aren't getting enough job growth to mop up all the people who already are out of work.

MARTIN: Now finally, there's been a lot of talk about whether the Federal Reserve can do more to spur employment. Can you tell us a little bit in the time we have left about what's being talked about there?

GEEWAX: The Federal Reserve is - that's the nation's central bank, and they have a lot of influence over interest rates. The Federal Reserve policymakers are going to have a two-day meeting next week, and coming out of that meeting, people are hoping for signs that they will continue to hold down interest rates.

You know, those interest rates are really important when a business is deciding whether or not to expand. They want to know that this interest rate environment is going to be pretty low, that it'll be cheap to borrow. If you are a homebuyer, and you need time to look around, you can't just buy the first house you see, you want to know that interest rates are going to stay low for a while so that you can really get back into that housing market.

So the Fed is expected to most likely announce more steps that will continue to depress interest rates, to give borrowers that chance to get back into the game.

MARTIN: Now we have a little less than a minute left. So why don't I ask you if there's any silver lining there for someone who's looking for a job particularly?

GEEWAX: Well, you know, this issue of the labor force shrinking, you know, that can be kind of a good thing, that is there are lots and lots of baby boomer who maybe lost their jobs when they were 58, 59 years old, but this has gone on a long time. This has been a very slow recession. So those people are now in their 60s. They're retiring. They're leaving the workforce.

Well, you know, that may be tough on their own household economics, but if you're a 40-year-old, and you're looking for a job, it's sort of a good thing to have baby boomers retiring, to create more space for you. So that might be a silver lining.

MARTIN: Marilyn Geewax is a senior business editor with NPR. She was kind enough to join us once again in our studios in Washington, D.C. Marilyn, always good to see you.

GEEWAX: Oh thanks so much, Michel, great to be here.

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