Why 10 Percent Unemployment Is Good
SCOTT SIMON, host:
This is WEEKEND EDITION from NPR News. I'm Scott Simon.
Been some time since there was anything positive to say about the job market, but a report released yesterday by the Labor Department contained the clearest evidence yet that the unemployment picture may finally be improving. The government said the unemployment rate not only did not go up, it actually fell a bit in November, to 10 percent.
NPR's Jim Zarroli reports.
JIM ZARROLI: The government said businesses cut 11,000 jobs from their payrolls last month. The losses were a tenth of what economists had been expecting and they pale beside the massive job hemorrhaging that took place last winter. The government also said job losses in September and October were lower than first thought. Speaking in Pennsylvania, President Obama called the report the best we've seen since 2007.
President BARACK OBAMA: And this is good news, just in time for the season of hope. I've got to admit, my chief economist, Christy Romer, she got about four hugs when she handed us the report.
ZARROLI: It wasn't just that job losses were so low. The report also said temporary help agencies added 52,000 jobs during the month - the fourth straight increase. Dean Baker is co-director of the Center for Economic and Policy Research.
Mr. DEAN BAKER (Center for Economic and Policy Research): It tends to be the case these days that employers take people on as temporary workers before they actually get permanent employees. So if this isn't an aberration, that's a very good sign.
ZARROLI: Then too, the length of the average work week also rose, which economists say is often a good sign as well. Nigel Gault of IHS Global Insight says employers have been cutting back jobs for a long time.
Dr. NIGEL GAULT (Chief Economist, IHS Global Insight): And they probably reached the point where they can't actually extract any more out of their existing workforce. So they need to add hours and in some cases they need to add staff if they are to continue to increase output.
ZARROLI: Once businesses do start hiring, they will have lots of applicants. At a New York State job center in White Plains this week, more than 700 people showed up looking for work. They included Candy Isello(ph), who lost her job in radio sales just two months ago. She's relatively optimistic.
Ms. CANDY ISELLO: I'm hearing that, you know, some companies are thinking about hiring again for the beginning of the year. I've been on a few different job interviews that said, yes, they are interviewing now for 2010. So it's a good sign. I have hope.
ZARROLI: But a lot of the people here have been out of work for many months. Henry Font(ph) is a freelance designer of electrical systems. With the collapse in construction, he's had to sell his apartment to survive.
Mr. HENRY FONT (Electrical Systems Designer): For me, that's the total slowdown, you know, it's like crashing. There is no work. I've been unemployed practically since January. And it's going to be a year.
ZARROLI: The government says 14 million people are unemployed, and half of those have lost their jobs since September 2007, when the recession began. Dean Baker says it will take a long time for the labor market to recover, yesterday's jobs report not withstanding.
Mr. BAKER: And even if we take the best possible reading of this, we could say, okay, maybe we're on the right track. But we have so far to go that we're looking at a situation, you know, even, say, three years out, where suppose we had six percent unemployment, we would ordinarily consider that a horrible story.
ZARROLI: And President Obama said something similar yesterday. As encouraging as the jobs report was, he said the unemployment problem is still dire and Congress needs to pass legislation to create jobs. The president says he'll unveil some ideas to jumpstart private sector hiring next Tuesday.
Jim Zarroli, NPR News, New York.
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