Unemployment dips below 8 percent

A worker directs traffic for street construction in Portland, Ore., Friday. The Labor Department reported Friday the unemployment rate fell to 7.8 percent in September, a decline of 0.3 percentage point and the lowest since January 2009. The government said the economy created 114,000 jobs, about as expected, and generated 86,000 more jobs in July and August than first estimated. Photo by The Associated Press.

By The Associated Press

Saturday, October 6, 2012

WASHINGTON (AP) — The U.S. unemployment rate dropped below 8 percent for the first time since the month President Barack Obama took office, a surprising lift for both the economy and his re-election hopes in the final weeks of the campaign.

The rate, the most-watched measure of the country’s economic health, tumbled to 7.8 percent in September from 8.1 percent in August. It fell because a government survey of households found that 873,000 more people had jobs, the biggest jump since January 2003.

The government’s other monthly survey, of employers, showed they added a modest 114,000 jobs in September, but it also showed job growth in July and August was stronger than first thought.

Obama, eager to shift attention from a disappointing performance at the first presidential debate, said Friday that the report showed the country “has come too far to turn back now.”

Romney countered: “This is not what a real recovery looks like.”

The drop brought the jobless rate back to where it was when Obama was sworn in, in January 2009, and snapped a 43-month streak in which unemployment was 8 percent or higher — a run Romney had been emphasizing.

The October jobs report comes out Nov. 2, four days before the election, so Friday’s report provided one of the final snapshots of the economy as undecided voters make up their minds.

The government calculates the unemployment rate by calling 60,000 households and asking whether the adults have jobs, and whether those who don’t are looking for work.

Those who do not have jobs and are looking are counted as unemployed. Those who aren’t looking are not considered part of the work force and aren’t counted as unemployed.

A separate monthly survey seeks information from 140,000 companies and government agencies that together employ about one in three nonfarm workers in the United States.

That survey found that the economy added 114,000 jobs in September, the fewest since June. Most of the job growth came in service businesses such as health care and restaurants.

The Labor Department raised its job-creation figures by a total of 86,000 jobs for July and August. The July figure was revised from 141,000 to 181,000, and the August figure from 96,000 to 142,000.

Taken together, the two surveys suggest the job situation in the United States is better than was thought.

Economist Joel Naroff, president of Naroff Economic Advisors, called the strong employment reports “a shocker” that showed the job market was sturdier than most economists had thought.

Financial markets seemed less impressed. The Dow Jones industrial average climbed as much as 86 points in early trading but drifted lower for most of the rest of the day. It finished up 34 points at 13,610. The Standard & Poor’s 500 index, a broader measure, was down a fraction of a point.

Stock indexes have been trading at or near their highest levels since December 2007, the month the Great Recession began. They have gotten a lift from Federal Reserve efforts to stimulate the economy, and by a European Central Bank plan to buy the bonds of financially troubled countries to ease a debt crisis there.

The yield on the benchmark 10-year U.S. Treasury note climbed by 0.06 percentage point to 1.73 percent, a sign that investors were more willing to embrace risk and leave the relative safety of the bond market.

The unemployment figures were so surprisingly strong that some pundits and at least one member of Congress, Florida Republican Allen West, accused the Obama administration of manipulating the statistics to help the president’s prospects.

On Wednesday, Obama was widely seen as having lost his first debate with Romney.

Jack Welch, the retired former CEO of General Electric, said on Twitter: “Unbelievable jobs numbers ... these Chicago guys will do anything ... can’t debate so change numbers.”

But the unemployment data is calculated by a government agency, the Bureau of Labor Statistics, under tight security and with no oversight or input from the White House.

Keith Hall, a former commissioner of the BLS who was appointed by President George W. Bush, said the numbers could not have been manipulated.

“It’s impossible to do it and get away with it,” he said. “These numbers are very trustworthy.”

Economists offered reasons not to read too much into them, though. Most of the increase in employed Americans came from those who had to settle for part-time work: 582,000 more people reported that they were working part-time last month but wanted full-time jobs.

That is the biggest increase in so-called underemployed Americans since February 2009, during the depths of the Great Recession.

Economic troubles in Europe and Asia also may be taking a toll on American factories. Manufacturing employment dropped by 16,000 in September after falling by 22,000 in August.

Factory hiring had been a source of economic strength the past two years: Factory jobs rose last year at the fastest pace since 1997.

But Europe’s ongoing economic crisis, along with a slowdown in China, means demand for U.S.-made goods is drying up and “the days of robust manufacturing payrolls growth are likely behind us,” said Chris Jones, an economist at TD Economics.

The unemployment rate has fallen from a peak of 10 percent in October 2009. But a big part of the drop over the past three years came because so many Americans stopped looking for work, so they weren’t counted as unemployed.

Some were retiring baby boomers. Others were so discouraged by the weak job market that they stopped putting out resumes.

Economists were pleased with September’s drop in unemployment because it happened for the right reasons: More Americans got jobs. And the work force grew by 418,000, the most since February, suggesting people are more optimistic about finding jobs. Because 873,000 more people did find work, the number of unemployed fell by 456,000. And that decline pushed the unemployment rate down.

Arthur Nazh was not surprised to hear that the unemployment rate fell. Business has improved this year at the kiosk where he sells souvenirs at a mall in Arlington, Va.

The economy “is getting better,” said Nazh, 27, who employs six people and said he plans to vote for Obama because the economy needs more time to heal. “People are starting to buy more, spend more money.”

Obama and Romney campaigned Friday in Nazh’s home state and others that could tip to either candidate and determine the outcome of the election. Romney released three ads, mostly focused on jobs.

“These are tough times in this community,” Romney, the former Massachusetts governor, told a rally outside a construction equipment store in Abingdon, Va. “We’re going to bring back jobs and bring back America.”

At a campaign stop in Cleveland, Obama declared: “We are moving forward again.”

“Today’s news should give us some encouragement,” the president told thousands at Cleveland State University. “It shouldn’t be an excuse for the other side to try to talk down the economy just to try to score a few political points.”

The political back-and-forth over the unemployment numbers underscored the centrality of jobs to the election after a year in which the economy has been difficult to read.

The job market got off to a strong start in 2012. Employers added an average 226,000 jobs the first three months of the year.

Hiring in January, February and March was probably even stronger than that: The Labor Department has said 386,000 more jobs were created in the year that ended in March, but it has not assigned the jobs to specific months yet.

Job growth slowed sharply to an average 67,000 a month from April through June. And the weakness appeared to have continued into the summer, raising fears that a slow and steady economic recovery was losing momentum.

But the revisions to the July and August figures on Friday eased those fears somehwat. Monthly job growth was back up to an average 146,000 from July through September.

Naroff, the economist, predicted that unemployment would inch back up, and that job growth would settle at about 150,000 per month for the next several months. Economists at PNC Financial Services Group predict job growth will accelerate to 170,000 per month in 2013.

The economy is still far from full health. The number of U.S. jobs peaked in January 2008, a month after the Great Recession officially started, at 138 million. The job market shed 8.8 million jobs by February 2010. Since then, the economy has regained 4.6 million, or a little more than half, of those lost jobs.

No incumbent president since Gerald Ford in 1976 has faced re-election when the unemployment rate was as high as September’s 7.8 percent, even after the sharp drop from August. Ford lost to Jimmy Carter.

Ronald Reagan faced 7.2 percent unemployment in 1984 and trounced Walter Mondale to win a second term.

More like this story

him 7 months, 2 weeks ago

Do the added jobs acount for 2nd part-time jobs? People that have a full time job but had to get a second job to make ends meet? Take those numbers out of the total.

connor 7 months, 2 weeks ago

The July and August numbers were up adjusted by almost 90,000 and added into Septembers numbers which is why we see a big step down. Participation rate however was not changed which in my mind is the real factor and indicator of the economy.

Healthcare had the largest industry jump in hiring followed (not very closely) by warehouse and transportation which leads me to believe they were not part time jobs but full time low wage ones, but that is just a guess.

linoge 7 months, 2 weeks ago

This makes for a good headline. I like the sound of it. I remain very skeptical. The facts seem to be that despite all the generous tax breaks being given to the wealthy business people and industrialists, our American jobs continue to be exported into third world countries. Cheap labor and no environmental restraints allow these pirates to continue their rape.

spelchek 7 months, 1 week ago

LOL. Inform us as to who is strangling the coal industry to death? Spare us with the " generous tax breaks ". As if we should be so grateful that the gracious government is doing us a favor by letting us keep more of the money we earned. Who is greedier? The person producing/working to make a profit or the person producing nothing but demands the producer do everything their way while demanding more of a cut of the profits because they have a spending problem. Your line of thinking is why the economy is not recovering no matter how much this administrations cheerleaders (MSNBC, NYT, CNN, ABC, CBS, NBC, SLPD, WP, NPR, etc...) spin us the contrary. Successful people create jobs. Once you've taxed/regulated them out of existence because of emotion rather than logic, we'll all be losers and equally miserable. Hope indeed.

RobHunterJohnson 7 months, 2 weeks ago

linoge Thanks, Romney continues to be exposed on this at Bain, I hope people are listening. Rob

connor 7 months, 2 weeks ago

Outsourcing isn't just a big corporation thing. Free trade regulations supported by democrats to help the under developed countries contributes to it just as much if not more.

RobHunterJohnson 7 months, 2 weeks ago

Time to bring it home! Buy American, not Thrifty. Rob

os2hank 7 months, 2 weeks ago

RobHunterJohnson--exactly what "jobs at Bain" were sent oversea, first hand knowledge please (not some you read about from liberal paper --Nor any from Obama Ads)

RobHunterJohnson 7 months, 2 weeks ago

os2Hank, Bain Closes US plant, forces workers to train Chinese replacements. Anger grows in IL. at Bains lateset outsource plan. Romney invested millions in Chinese firm. Hank there is 10 pages of this stuff under Bain China at Google, and it goes back to July 2012 on page 10. I WONDER WHAT IS BACK 10 YEARS IN THE REPUBLICAN HEROS RESUME? There is a reason why we cannot see his taxes, you need to start thinking outside of the box and reading? This Hero wants a National Right to work law, He seems very content to ship everything overseas to reap a profit selling THRIFTY items her in the Good Old USA. We do not need someone to fix our country with this type of ethic! BUY AMERICAN! I would give you links, I am an old constuction worker who can hardly type, but I sure can read. Rob

eileen10 7 months, 2 weeks ago

Don't like to butt in but I 'm curious about things so I googled "bain" then read the first story. I'ts from the Pittsburg Post which I'm not familiar with. There's to much to type but from what I read it wasn't real good.

RobHunterJohnson 7 months, 2 weeks ago

Thanks eileen10, Thats all I find, I read something Itry to follow up? os2hank needs to look back a little deeper. Rob

eileen10 7 months, 2 weeks ago

I didnt know if I helped or not because as you know I'm not up to snuff on all this stuff.Sounds to me like there's a bunch of funny stuff going on though which I guess is why Romney is so closed mouthed. Am I close on how I feel?

RobHunterJohnson 7 months, 2 weeks ago

I hope other will take a deeper look. Rob

eileen10 7 months, 2 weeks ago

Maybe he's doing that now.

RobHunterJohnson 7 months, 2 weeks ago

The Republican POSTERS on the NT sight need to take a look at A6 of the NT sunday paper, Romney has not seen that many a a venue yet. Rob

connor 7 months, 2 weeks ago

I really just cannot figure out what you Obama supporters are trying to accomplish with the Bain Capital attacks. That company was run pretty much like any other company of it's type and very successfully as well. As a Governor and as a Business man/CEO Romney has shown he answers to and performs for the people he is required to work for. Under the environment our government has created, both by Republicans and Democrats, sending jobs overseas is a fact of life and required for the very survival of a company. Bashing Romney for this and not mentioning things like all the money Obama sent to Brazil so they could drill and sell to the U.S. (if they don't send it to the Russo/Chinese that is) just once again highlights Democrat hypocrisy.

Romney's history proves he will represent those he is suppose to represent within the boundaries and mechanism established for that office. I am afraid your boy Obama has shown he is not capable of such responsibility.

RobHunterJohnson 7 months, 2 weeks ago

President Obam did not make money off of what he has done! Rob

connor 7 months, 2 weeks ago

No? Well no money came to him or any of his supporters directly that we know of or that I care to follow anyway. Yet that is not what is important here because as I see it Obama's move did nothing to support any US citizen at all, unless it was some bundler who was invested in Brazilian oil fields. That is the point Obama does not work for the people he is paid to work for where as Romney has proven he will and has in multiple cases.

Seems like an obvious choice to me.

John 7 months, 2 weeks ago

Obama's personal wealth is in the millions of dollars. He obviously DID / DOES make money. He also makes personal profit off of taxes that he helps to implement (as do all federal employees and elected officials). Therefore, RobHunterJohnson's statemetn that "Obam" [sic] "did not make money off of what he has done!" is absolutely incorrect at best and a liberal lie at worst.

RobHunterJohnson 7 months, 2 weeks ago

Oil is Oil, would it not be better to burn Brazilian Oil, rather than pumping it out of Alaska to sell to China? We cannot refine what is here now? Guess who is interested in that Canadian Oil? China! Romney is part of the problem, if Americans are working we pay more taxes, we spend more money, and we create more jobs! we could pay of the debt better with this method. If we are investing in other places we see no real benefit from this, except at the retail level, Dock workers, and Middle Men. Romney is interested in low paying jobs, No Benefits, breaking unions, and reducing the pay scale of everyone. It will not happen overnight, but it will. If we are not making GOOD MONEY, we cannot make the purchases to fuel this economy, or reduce this debt. It is the like mined thinking of Romney and the rich to milk every penny out of this economy. I am not a socialist, I am American smart enough to see that we better start investing in this country, and tell Congress that those who wish to take their JOBS over seas to stop it, it is the VACUUM sound Ross Perot was refering to back in the 90s. Rob

connor 7 months, 2 weeks ago

You are not misguided in your goals Rob, you are misguided in who you think will take us there. Obama invests more of American money into foreign interests than any company bent on survival in the modern age ever thought about doing. His interest in Americans is limited to public service unions and throwing bones occasionally to certain racial groups and special interest groups all which ends up lining his own pockets as well.

Obama's moves are much more destructive at least any move Romney made while at Bain was done with his own money and that of willing investors. Obama on the other hand freely misuses every tax payers money for his own gain against the wishes of most of those who pay.

RobHunterJohnson 7 months, 2 weeks ago

Our electeted representation will USE or MISUSE our tax money. That is the JOB of Congress which has failed in the last 2 years, and even back to Vietnam. Tricky Dick was giving Money to the Shah Of Iran back about the time you were born, and I HOPE you can see what that got us? Please do not tell me, that Presidemnt Obama is only one who has been giving it away, the list starts at the end of WW2. I have never seen a Broke President in my lifetime, the meek mild President Truman who weilded one big stick at the end WW2, and that was by his choice! Dont get me wrong I respect President Truman for his choice, unlike Akin trying to compare himself to Truman. Rob

connor 7 months, 2 weeks ago

Now your talking Rob!!! So on this Bain issue you state that Obama is just as bad about sending jobs overseas as Bain was. Of course Obama was President and while at Bain Romney wasn't sooooooooo who is the most sinister then?

Glass houses and all that.

RobHunterJohnson 7 months, 2 weeks ago

I DID NOT SAY THAT! Bain Is a business! Goverment is Goverment! We have been propping up countries through war or rebuilding since ww2 when we rebuilt Japan, and Germany. Romney has spent more than the last few years betting against America, and even his dear old dad was not like him, I lived in Michigan in the middle 70s. If you want someone to straighten this mess out, I sure would not use someone who is so greedy, he would not want to invest in his own country? Jobs over seas are being sent over there by corporations not Presidents, and that is RAW GREED, and our Representive is th one to stop this, Rob

wow 7 months, 2 weeks ago

Rob you said it right. Corps choose overseas to get rich and to either avoid or evade taxes. There is no other reason. But Romney said he didn't know about any deductions for US Corps who choose to operate overseas. What a crock...I guess he missed that class on how to get over on your taxes. If this guy thinks anyone believes he does not know the various loopholes companies use to pay less taxes, avoid paying any taxes for long periods of time or evade paying taxes altogether..I have a bridge for sale.

I wasn't voting for him anyway, but now I don't even like seeing him on TV making a fool of himself. After that debate where he clearly was the aggressor, he also clealry proved to be the "WOLF", the guy that ain't trying to help anyone but himself, the guy who truly dislikes the 47% of folks he called tax cheats. Nawwww ya can keep Romney, I don't repsect him any longer.

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