More Jobs Created Than Economists Expceted
STEVE INSKEEP, host:
It's MORNING EDITION, from NPR News. Good morning. I'm Steve Inskeep.
RENEE MONTAGNE, host:
And I'm Renee Montagne.
The plunge in the stock market yesterday meant that this morning, people were watching, especially closely, one key economic report: jobless numbers. It's now out, and the Labor Department is reporting that unemployment actually fell last month, down slightly to 9.1 percent. And there were more jobs created than most economists were expecting. That's welcome news after markets took a dive -not just in the U.S., but around the world.
NPR's business correspondent Yuki Noguchi joins us live, now.
And Yuki, put these numbers in perspective.
YUKI NOGUCHI: Well, so, as you say, the number of jobs added was 117, largely because of unexpected - sort of business-job growth, which was 154,000. And that was better than expected.
But, you know, at first glance, that sounds really good. But the concerning thing is that the labor force participation fell. So more people gave up looking for work, and that helps the unemployment rate.
So, you know, this - none of this is actually anything that...
MONTAGNE: Helps it, because they disappear, basically, from...
NOGUCHI: Right. So there's fewer people in the labor force, so it's, you know, easier - you know the 154,000 number has a bigger effect on the rate. And that's why you saw that rate decrease.
But, you know, none of this is really going to change the macroeconomic picture, really.
MONTAGNE: Well, let's talk about the markets, then. Markets in Asia were down quite a bit this morning, following those big drops in the U.S. markets yesterday. Now, in New York, markets have just opened. What's the latest?
NOGUCHI: Well, it's really mixed. I mean, overnight and then early this morning, you saw a lot of pessimism in the futures. And then they opened fairly big. But now they're basically about unchanged. So if you look at the market performance overall in the last two weeks or so, I mean, the Dow is down, basically, about 10 percent. And what they're responding to, primarily, isn't jobs so much, but Europe. The eurozone is struggling with debt problems that are threatening to sort of burn the house down. And you've got to remember that U.S. banks have a lot of holdings in Europe, so that's a vulnerability.
MONTAGNE: Well, can we talk about other economic indicators? They've not, of course, been encouraging of late. Does this report indicate anything has changed?
NOGUCHI: No. I mean, no. The news today is, at best, tepid, so - not just for jobs and hiring. You know, what you've seen and what you just alluded to was manufacturing that's, you know, flat-lined. Consumer spending is sort of not happening. And, of course, economic growth during the first half of this year proved to be much slower than we thought.
And so you hear now more talk of sort of going back into recession, the possibility of a double-dip. And that's considered a possibility because, basically, we're just barely in recovery, and we're just not on solid ground. So, you know, it could go negative at any point, is the idea.
MONTAGNE: Yuki, earlier this week, there was another report saying mass layoffs seem to be making a comeback. HSBC, the bank, laid off 30,000 people, like, in one stroke. Borders Books liquidated and announced big layoffs. Is that particular strain contributing to the - problem?
NOGUCHI: Yeah. I mean, what's interesting about that is you also saw, you know, mass layoffs now in - from Cisco and Merck. And, you know, these are companies that are across different industries. And some of them are not necessarily responding to specific economic problems. But it's just not a good sign.
I mean, you - some of them are, of course, related to the economy. Goldman Sachs announced some layoffs. And, you know, regardless, having, you know, that kind of, you know, addition to the unemployment roles is not very helpful.
MONTAGNE: Well, one last thing about jobs, generally, in the U.S. Last month, we talked about government losing jobs, and that was a big factor in this report, which also showed very weak job growth.
NOGUCHI: Yeah. I mean, Minnesota shut down. That was a big deal, and that accounted for the bulk of the 37,000 government cuts you saw. And, you know, in general, government sector, not looking good.
MONTAGNE: Yuki, thanks very much.
NOGUCHI: Thank you.
MONTAGNE: NPR business correspondent Yuki Noguchi. Transcript provided by NPR, Copyright National Public Radio.