Politics
3:53 am
Sat June 2, 2012

Fingers Point As Job Numbers Fall

Originally published on Sat June 2, 2012 12:01 pm

If unusually warm weather helped encourage job growth earlier this year, May was like a wet, cold rain. A report from the Labor Department on Friday showed that U.S. employers added just 69,000 jobs last month — far fewer than expected.

Hiring ground to a halt across different industries in many parts of the country. Republican White House hopeful Mitt Romney seized on the report as fresh evidence to attack President Obama's handling of the economy. The disappointing numbers sent the Dow Jones industrial average plunging nearly 275 points.

"My sense is that it's fear," says Mark Zandi, chief economist of Moody's Analytics.

Zandi says would-be employers have been spooked by the sell-off in the stock market, the slowing growth in China and the European debt crisis that never seems to end.

"Businesspeople are just very nervous. They've been through a lot. If anything goes off-script, they pull back. They stop hiring," he says.

The 69,000 jobs added in May represent the slowest pace of hiring in a year. At the same time, hundreds of thousands of new jobseekers started looking for work. That sent the unemployment rate up to 8.2 percent.

Talking Jobs On The Campaign Trail

The disappointing jobs report comes at a bad time for Obama, since these are the months that tend to shape voters' opinions about the economy as they prepare for the November election. Obama stressed Friday that the U.S. is still adding jobs — just not quickly enough.

"We knew there would be ups and downs along the way," he said. "But we also knew if we were willing to act wisely and boldly, and if we were acting together as Americans ... and never quit, then we wouldn't just come back. We'd come back stronger than ever."

Romney argues the president has had three and a half years to turn the economy around. Speaking on CNBC on Friday, Romney said the U.S. should be well into a robust recovery by now.

"Their policies have not worked, and in many respects their policies have made it harder for the economy to recover," he said. "I think that's one of the reasons why people are looking for a new direction."

'Political Gridlock'

Obama loyalists argue the struggling job market is less an indictment of the president's policies than the failure by Congress to pass them.

Jared Bernstein, Vice President Joe Biden's former chief economist, says the president hasn't been able to get much through Congress in the last year and a half, ever since Republicans took control of the House.

"The president has been pushing for policies which — if they were in place — the job market wouldn't be doing as badly as it is," he says.

For example, Obama has called for more federal spending on public works projects and local government, which might have prevented last month's loss of 28,000 construction jobs and 13,000 government jobs. But Congress never approved that spending.

Bernstein, who's now a senior fellow at the Center on Budget and Policy Priorities, says lawmakers have added their own measure of uncertainty with their refusal to compromise on taxes, spending targets and the debt ceiling.

"I think the political gridlock, or dysfunction, if you will, has made things even worse. Now we're talking about going over this fiscal cliff and having another debt ceiling fight," he says. "That's obviously exactly the wrong medicine for the current economy. So it's not just that Congress isn't helping; it's that they're actively hurting."

What It Means For Obama

Obama renewed his call Friday for congressional action on the jobs front. And his re-election campaign has been busy criticizing Romney's record on job creation when he was governor of Massachusetts.

Still, Nathan Gonzales, deputy editor of The Rothenberg Political Report, says history suggests it's Obama who will be held accountable for the economy if things don't improve between now and November.

"Voters just want to feel like the country and the economy are headed in the right direction," he says. "And I don't know if enough voters believe that right now to help the president win a second term."

At this point, there aren't many months left to change their minds.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

SCOTT SIMON, HOST:

This is WEEKEND EDITION from NPR News. I'm Scott Simon. Investors and jobseekers got a jolt this week. A report from the U.S. Labor Department showed that U.S. employers added just 69,000 jobs last month. That's far fewer than expected. The news sent the Dow Jones Industrial Average plunging nearly 275 points. Republican Mitt Romney cited the report as fresh evidence to criticize President Obama's handling of the economy. NPR's Scott Horsley reports.

SCOTT HORSLEY, BYLINE: If unusually warm weather helped encourage job growth earlier this year, May was like a wet, cold rain. In many different industries, in many parts of the country, hiring ground to a halt.

MARK ZANDI: My sense is that it's fear.

HORSLEY: Economist Mark Zandi of Moody's Analytics says would-be employers have been spooked by the selloff in the stock market, the slowing growth in China, and the European debt crisis that never seems to end.

ZANDI: Businesspeople are just very nervous. They've been through a lot. If anything goes off script, they pull back. They stop hiring.

HORSLEY: The 69,000 jobs added in May represents the slowest pace of hiring in a year. At the same time, hundreds of thousands of new jobseekers started looking for work last month. That sent the unemployment rate up to 8.2 percent. The disappointing jobs report comes at a bad time for President Obama, since these are the months that tend to shape voters' opinions about the economy as they prepare for the November election. Mr. Obama stressed yesterday the U.S. is still adding jobs, just not quickly enough.

PRESIDENT BARACK OBAMA: We knew there would be ups and downs along the way. But we also knew if we were willing to act wisely and boldly, and if we were acting together as Americans, if we were willing to keep at it, if we were willing to roll up our sleeves and never quit, then we wouldn't just come back. We'd come back stronger than ever.

(APPLAUSE)

OBAMA: That was our belief.

HORSLEY: Republican White House hopeful Mitt Romney argues the president's had three and a half years to turn the economy around. Speaking on CNBC yesterday, Romney said the U.S. should be well into a robust recovery by now.

MITT ROMNEY: Their policies have not worked. And in many respects their policies have made it harder for the economy to recover. I think that's one of the reasons why people are looking for a new direction.

HORSLEY: Obama loyalists argue the struggling job market is less an indictment of the president's policies than the failure by Congress to pass them. Jared Bernstein, who used to be Vice President Biden's chief economist, says the president has not been able to get much through Congress in the last year and a half, ever since Republicans took control of the House.

JARED BERNSTEIN: The president has been pushing for policies which, if they were in place, the job market wouldn't be doing as badly as it is.

HORSLEY: For example, Mr. Obama's called for more federal spending on public works projects and local government, which might have prevented last month's loss of 28,000 construction jobs and 13,000 government jobs. But Congress never approved that spending. Bernstein, who's now with the Center on Budget and Policy Priorities, says lawmakers have added their own measure of uncertainty with their refusal to compromise on taxes, spending targets and the debt ceiling.

BERNSTEIN: I think the political gridlock, or dysfunction if you will, has made things even worse. Now, we're talking about going over a fiscal cliff and having another debt ceiling fight. I mean, that's obviously exactly the wrong medicine for the current economy. So, it's not just that Congress isn't helping. It's that they're actively hurting.

HORSLEY: Mr. Obama renewed his call for congressional action on the jobs front yesterday. And his re-election campaign's been busy criticizing Romney's record on job creation when he was governor of Massachusetts. Still, Nathan Gonzales of the Rothenberg Political Report says history suggests it's Mr. Obama who will held accountable for the economy if things don't improve between now and November.

NATHAN GONZALES: Voters just want to feel like the country and the economy are headed in the right direction. The whole problem doesn't have to be solved. The economy doesn't have to be running on all cylinders. They just want to know it's headed in the right direction. And I don't know that enough voters believe that right now to help the president win a second term.

HORSLEY: And there aren't many months left to change their minds. Scott Horsley, NPR News, the White House. Transcript provided by NPR, Copyright NPR.