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Good News! 80,000 jobs were added in October, but the U.S. economy is still growing at a snail’s pace.
I guess it’s better than nothing.
With unemployment at 9%, the economy is still sluggish.
The economy needs an additional 125,000 jobs a month to keep up with population growth. And even more to bring down the unemployment rate.
Private sector additions totally 104,000 for the month. 22,000 jobs were added by restaurants, hotels and entertainment companies. Professional and business services (including engineering and accounting) added 32,000 jobs. Health care added 12,000. However the construction sector cut 20,000 jobs for the month (that’s the most since January of this year.)
Without a significant growth in jobs, the tax-burden rests on fewer people. Without more jobs and higher wages, consumers will probably curb their spending in the months ahead – especially over the holiday season. Consumer spending is critical for the US economy because it accounts for about 70% of economic activity.
But let’s take this as a small victory, yes? In fact the unemployment rate dropped to just 9% from 9.1%, but it’s the first time it has fallen since July this year, the government said.
The underlying momentum of the economy is better now than we thought it was a few months ago – Augustine Faucher, director of macroeconomics at Moody’s Analytics.
Is this a beacon of hope, or a damp squib? Only the next few months will tell. We’re all in for a tough ride, but this news at least is something to cling onto whilst we wait an see.