Labor Department latest jobs report has markets, analysts nervous, scratching their heads
Only 74,000 jobs added to U.S. economy, unemployment rate falls due to people dropping from labor force
The latest jobs report had some analysts scratching their heads, and markets turning jumpy. According to the Labor Department, only 74,000 jobs were added to the U.S. economy, far short of the expected 200,000, and far less than in previous reports.
In early morning trading the Dow was down around over 50 points, though recovering somewhat.
The bleak jobs report comes only a month after the Federal Reserve said it would begin “tapering” its bond purchasing, saying that the economy was showing signs of better job growth. Reuters is reporting that Richmond Federal Reserve President Jeffrey Lacker said that he was encourage with the level of economic growth and that further reductions to the Fed’s bond buying may be in order.
Then today’s Labor Department jobs report.
The report states that unemployment fell .3 percent to 6.7 percent. But the labor force participation rate declined by 0.2 percentage point to 62.8 percent in December as more people left the work force without finding jobs.
Congress is currently considering whether to extend unemployment benefits for an additional three months for about 1 million Americans, a move opposed by the GOP. Long term unemployment has been at historic highs since 2008, but have been coming down and are now at the same peak level as seen in the recession of the early 1980’s. But extended benefits have never been cut when long term unemployment has been at these levels.