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Is Economy's Partial Recovery Enough For Voters?

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Is Economy's Partial Recovery Enough For Voters?

Economy

Is Economy's Partial Recovery Enough For Voters?

Is Economy's Partial Recovery Enough For Voters?

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  • <iframe src="https://www.npr.org/player/embed/130435545/130435514" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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The Labor Department reported Friday that the U.S. economy lost 95,000 jobs in September and unemployment remained at 9.6 percent. The job losses were disappointing. But there was a bright spot: While public sector hiring was down, the private sector added jobs. Factory owners talk about their hiring plans for the fourth quarter and beyond.

MARY LOUISE KELLY, host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Mary Louise Kelly.

ROBERT SIEGEL, host:

I'm Robert Siegel.

And first this hour, the economy as measured by the latest jobs report. In September, 95,000 jobs were lost. Unemployment remained at 9.6 percent. But while public sector hiring was down last month, the private sector added jobs.

As NPR's Chris Arnold reports.

CHRIS ARNOLD: Going into the midterm elections, voters, of course, are focused on the economy. Unemployment has been above 9 percent for more than a year. About 15 million people looking for a job can't find one. And everybody wants to see the country gaining jobs, not losing them. So the headline here - down 95,000 jobs - is probably not going to inspire much hope.

Mr. NARIMAN BEHRAVESH (Chief Economist, IHS Global Insight): The initial reaction was one of slight shock, if you will, about how big the drop was.

ARNOLD: Nariman Behravesh is chief economist at the forecasting firm IHS Global Insight. He says after digging into the report, though, it's actually not as bad as it sounds.

Mr. BEHRAVESH: We looked at it carefully and realized most of that was because of the Census workers - 77,000 Census workers being laid off.

ARNOLD: Those job losses are just a one-time fluke that skews the data and makes it look worse than it is. Of course, the whole jobs report wasn't just a fluke in the data. A surprising number of teachers actually got laid off last month. That's just one sign of how stretched state and local governments are.

But when you look at private sector jobs, there we actually saw some job growth. And that's what President Obama highlighted today when he spoke at a small business in Maryland.

President BARACK OBAMA: This morning, we learned that in the month of September our economy gained 64,000 jobs in the private sector. July and August, private sector job numbers were revised upwards. So we've now seen nine straight months of private sector job growth.

ARNOLD: Nariman Behravesh agrees that is moving in the right direction. But he says we're still not seeing that many private sector jobs added. He says, over the past few months, we've averaged around 100,000 new jobs a month, when he'd like to be seeing two or three times that every month.

(Soundbite of machinery)

ARNOLD: You can see this very gradual economic recovery underway on the factory floor at F.H. Peterson Machine Corporation outside Boston. The family business employs about 60 people, and like many other machine shop's scattered across New England, it makes all sorts of metal parts.

Mr. MARK MERULLO (Sales Manager, F.H. Peterson Machine Corporation): Just what I'm looking at here, I can see food processing equipment, a prototype part for the Air Force that goes on into a fuselage of an airplane.

ARNOLD: Mark Merullo, who is one of the owners, he's standing near a big machine that's spinning and cutting a two-foot wide metal part for a nuclear reactor.

(Soundbite of machinery)

ARNOLD: With work drying up during the recession, Merullo's employees here had their hours cut back very sharply.

Mr. MERULLO: So guys that would normally be working 50, 55, sometimes 60 hours a week, all of a sudden were cut down to 32 hours on straight time and taking a day off a week. So it was a big hit.

ARNOLD: But Merullo says in recent months, business has been picking up. Most of his workers are back to 40 hours a week. And while he's not hiring right now, he says, things are definitely looking better.

Mr. MERULLO: I was in New York last week at a trade show, and the feeling down there, we talked to people, you know, from all over the East Coast, some people from the Midwest. And everybody is optimistic that business has definitely improved in the last six months.

ARNOLD: It's just that, so far, that optimism isn't translating into companies hiring a lot more workers.

Mr. MERULLO: We were down in the dumps so low, people really want to make sure that it's staying that way before they put people on. And if they need three or four, I think, they'll put on one and wait a little while more.

ARNOLD: So the economy does still appear to be on the mend. It's just a very slow and cautious mend. And as we head into the midterm elections, a big question for incumbent politicians is whether that will be enough to satisfy voters who, of course, would like to see the economy improving faster than it is.

Chris Arnold, NPR News, Boston.

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