For 43 consecutive months US joblessness has lingered above 8 per cent and the world’s largest economy has suffered as a result. Not since 1948, and the dark post-war years, has persistent unemployment been such an issue for the nation. Business investment has dropped, as has global demand and household incomes and unemployment has become the key issue in the current Presidential battle.
During the US recession, which came to an end in mid-2009, 8.8 million jobs were lost. In the three years since less than half of those jobs have been recovered and the population has grown.
Last September President Barack Obama attempted to counteract the issue by instating the American Jobs Act. The purpose of the act was to provide state aid, increase public-works spending and cut payroll taxes for employers and employees. So far Obama’s Act has failed to reduce the unemployment figure – a fact his opponent Republican Mitt Romney has been quick to capitalise on. Romney has promised that he will succeed where Obama failed and use reduced tax and development in the energy sector to create 12 million new jobs.
As the election draws ever closer every data release counts.
Now, 88 economists involved in a Bloomberg survey have forecast an increase in US unemployment figures.
The economist’s median estimate is that in September US unemployment grew to 8.2 per cent from the previous month’s figure of 8.1. They cited restricted hiring as the primary cause for this rise.
The anticipated increase for September implies that for each month of the third quarter headcounts rose by an average of 117,000. If this is corroborated by today’s data release than it will be the second-slowest pace of increase since 2010.
Economists have also predicted that today’s report will show that private payrolls in September were probably up 27,000 from August’s figure of 103,000.
Ethan Harris, Bank of America Corp’s co-head of Global Economics, commented: ‘We’re running in place. A gain of around 100,000 or so jobs is just enough to absorb the population of new workers.’
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