US workers and the Obama administration face another round of glum monthly job and unemployment figures when the Labor Department releases September data on Friday, analysts said.
A month before President Barack Obama faces a national election vote focused largely on his economic leadership, economists say Friday’s numbers are unlikely to budge the high 8.1 percent national jobless rate.
While some recent signs showed a mild pickup in business activity in September, the economy is still too turgid to reduce the nearly 20 million Americans who are either actively looking for jobs or who have given up looking.
That spells more bad news for Obama, who came under a withering attack from Republican rival Mitt Romney over persistent joblessness in their debate Wednesday night.
“There’s no question in my mind that if the president were to be re-elected you’ll continue to see a middle-class squeeze with incomes going down and prices going up,” Romney blasted Obama.
“You’ll see chronic unemployment. We’ve had 43 straight months with unemployment above eight percent.”
August’s data underscored the depth of the problem. The unemployment rate fell to 8.1 percent from 8.3 percent a month earlier, and the total number of official jobless fell to 12.5 million from 12.8 million people, both improvements on the surface.
But only 94,000 net new jobs were created in August, on average the same as the previous two months. That is hardly enough to keep up with the natural growth of the labor force and is well below the average of 151,000 a month for the previous year.
In fact, the fall in the official jobless rate was due to more people dropping out of the search for work altogether — that number hitting a post-recession high of nearly 7 million.
Data in recent weeks signal just a slight pickup in employment if any: weekly unemployment claims, an indicator of layoffs, have been flat, and indicators of private sector hiring are also tepid.
Joseph LaVorgna of Deutsche Bank predicts September’s numbers will show an increase in new jobs to 100-120,000, still barely above the natural increase of the labor supply.
“Just as the economy appears to be stuck in low gear, so too does the labor market,” said LaVorgna.
Inna Mufteeva, US economist at Natixis, is more bullish, forecasting 140,000 new jobs and the unemployment rate holding steady at 8.1 percent.
“So far, the leading indicators on the employment market have been sending rather positive signals,” Mufteeva said.
The one thing the numbers Friday are likely to achieve is to remove doubts about the Federal Reserve’s new QE3 stimulus, an open-ended bond-buying program announced September 13 and justified by the persistence of high joblessness.
“Nothing in the report should deter the Fed from continuing with its aggressive policy easing,” said former Fed adviser Stephen Oliner, an economist at the American Enterprise Institute.
Oliner expects the net job creation number to come in at 100,000, and the jobless rate to tick back up to 8.2 percent.
September jobs numbers likely glum again: analysts
