Podcast: The June Employment Report and What It Means for the Economy
I’m Keri Fulton and I’m here with Chad Stone, the Center’s Chief Economist, to discuss the jobs report for June.
1. Chad, is there any promising news in today’s jobs report?
The good news in today’s jobs report is that the private sector continued adding jobs in June as it has each month this year. And the unemployment rate dropped to 9.5 percent, the lowest it’s been in almost a year. But along with the good news comes the bad: private sector job growth is still disappointingly slow and the reason the unemployment rate dropped is that people stopped looking for work and left the labor force, not that large numbers of people found jobs. In order to bring people back into the labor force and lower the unemployment rate at the same time, we need to be creating jobs at a rate of at least 200,000 to 300,000 a month.
2. What’s needed to create jobs at this rate?
Stronger demand for goods and services. An effective jobs bill will move these numbers in the right direction. Unfortunately, hopes are fading fast for Congress to enact effective jobs measures. Too many lawmakers seem to think that their immediate priority should be the budget deficit rather than the jobs deficit.
3. What is the latest with the jobs bill? Has there been any progress?
Efforts to pass an adequate jobs bill unraveled in recent weeks, and Congress did not even pass minimal measures before leaving for its July 4th recess--no help for unemployed workers who are exhausting their benefits and no help for states struggling to close their gaping budget shortfalls. That means not just more hardship for many individuals, but also no boost to an economic recovery that is struggling to gather steam.
4. How does the absence of a jobs bill hurt the recovery?
Unemployed workers won’t have as much money to spend and will cut back their purchases. States will have to raise taxes, lay off workers, cancel contracts and scale back programs even MORE than they otherwise would. Reduced spending by unemployed workers, newly laid-off state employees, and state contractors who lose business will be a significant drag on the recovery and will impede job growth.
5. So, what should Congress do?
Temporary unemployment insurance benefits and state fiscal relief are two of the most effective measures to stimulate economic growth and job creation. A smaller program, called the TANF emergency fund is one of the most cost-effective job-creating programs we have. TANF stands for Temporary Assistance for Needy Families. Congress should enact these measures as soon as they get back.
Thanks for joining me, Chad.