Bloomberg News

Obama Fails to Gain as Unemployment Stuck Since March

July 06, 2012

Obama Fails to Gain as Unemployment Stuck Since March

President Barack Obama greets supporters after speaking at a campaign event at the Wolcott House Museum Complex on July 5, 2012 in Maumee, Ohio. Photographer: Chip Somodevilla/Getty Images

Job growth remained stuck in June, depriving President Barack Obama of progress on voters’ overriding concern as he campaigned in industrial Ohio and Pennsylvania.

U.S. employers added 80,000 jobs last month, below economists’ forecasts and up only slightly from a 77,000 increase in May.

As the November presidential election approaches and voters’ views of Obama’s performance solidify, the encouraging job gains at the start of the year have stalled. June concluded the worst quarter for private-sector hiring in more than two years, with last month’s 8.2 percent unemployment rate no better than in March.

Democrat Obama, speaking today at a campaign stop in Poland, Ohio, said the new jobs were “a step in the right direction” though the economy has to grow “even faster.”

Republican presidential candidate Mitt Romney called the jobs report “another kick in the gut.”

“The president’s policies have not gotten America working again, and the president is going to have to stand up and take responsibility for it,” Romney said at a hardware store in Wolfeboro, New Hampshire, where he’s vacationing this week.

Chances are slipping for an Election Day unemployment rate below 8 percent, a psychological milestone for voters, said Patrick Sims, a director at Hamilton Place Strategies, a Washington policy and communications firm co-founded by former Republican White House and Treasury press aides.

Final Stop

“Time has run out” to reach that goal, Sims wrote in a note to clients, calculating that the economy would need to add an average of 219,000 jobs during the next four months.

At the final stop of the two-day bus trip through Ohio and Pennsylvania, Obama told approximately 6,500 people at Carnegie Mellon University in Pittsburgh that “inch by inch, yard by yard, mile by mile” the economy is starting to grow again.

He repeated a campaign theme that rebuilding the economy isn’t from “the top down” but from “the middle class out.” Obama told the crowd, standing in 93 degree heat, that Romney’s plan to cut taxes for the wealthy was the same plan tried “before I took office. We tried it and it didn’t work.”

Obama has “got to be concerned about” the “sideways” jobs report, said John Podesta, a White House chief of staff under Democratic President Bill Clinton, in an interview for Bloomberg Television’s “Political Capital with Al Hunt” airing this weekend. At the same time, Podesta added, “I don’t think it’s a disaster either.”

Monthly ‘Referendum’

The monthly report has taken on so much political significance amid voter discontent with the economy that it amounts to a regular “referendum” on the president, said Kathleen Hall Jamieson, a professor at the University of Pennsylvania’s Annenberg School for Communication in Philadelphia.

“Once every month the public sees it as a signal of either the competence of the president or his failures,” Jamieson said in an interview before the report’s release. The Dow Jones Industrial Average (INDU) and “the unemployment rate are among the few things that voters can see over time as a continuing indicator that they understand.”

The Standard & Poor’s 500 Index slid 0.9 percent to 1,354.67 at 4 p.m. in New York, sending it lower for the week. Treasury 10-year yields fell five basis points to 1.55 percent.

Underemployment Rises

Private forecasters had expected the Labor Department report to show 100,000 new jobs last month, according to the median estimate of economists surveyed by Bloomberg News.

Joblessness has exceeded 8 percent since February 2009, the longest such stretch since monthly records began in 1948.

The so-called underemployment rate -- which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking -- increased to 14.9 percent from 14.8 percent.

Obama used his trip to draw a contrast with Romney, who co- founded Bain Capital LLC, based in Boston.

Romney’s experience “has been in owning companies that were called pioneers of outsourcing,” Obama said yesterday while campaigning in Maumee, Ohio. “My experience has been in saving the American auto industry, and as long as I’m president, that’s what I’m going to be doing.”

Shortly before the president’s arrival in Ohio yesterday, his administration announced that it had filed a complaint with the World Trade Organization accusing China of levying unfair tariffs on U.S. autos.

The duties cited in the WTO claim cover more than 80 percent of U.S. auto exports to China, including cars made in the Ohio cities of Toledo and Marysville, White House press secretary Jay Carney told reporters during the flight to Ohio from Washington yesterday.

To contact the reporters on this story: Mike Dorning in Washington at mdorning@bloomberg.net; Kate Andersen Brower in Pittsburgh at kandersen7@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net


Ebola Rising
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus