U.S. unemployment rates under President Bush have reached a 14-year high. According to the Bureau of Labor Statistics, unemployment climbed to 6.5 percent in October, as the country shed 240,000 jobs. U.S. unemployment rates under President Bush have certainly increased–for example, the unemployment rate for October 2007 was 4.7 percent. So far this year, the country has lost 1.2 million jobs, and over half of the decrease took place in just the last three months. Some suggest the situation could grow more bleak: Goldman Sachs projects the unemployment rate will reach 8.5 percent by the end of 2009. Another source I spoke with recently believes it could soar as high as 10 percent in the near future.
With U.S. unemployment rates under President Bush rising, there’s more talk of the nation being caught in a recession. In a New York Times story, Stuart G. Hoffman, chief economist at PNC Financial Services Group in Pittsburgh, notes, “The economy is slipping deeper into a recessionary sinkhole that is getting broader. The layoffs are getting larger, and coming faster. We’re likely to see at least another six months of more jobs reports like this.” In a Wall Street Journal roundup of economists’ reactions to the unemployment report, Joshua Shapiro of MFR Inc. says, "History tells that once the labor market weakens as much as it has in the past several months, job-shedding takes on a life of its own and tends to persist for a long while. We expect the employment data to be dreadful for many months to come and consequently for consumer spending to continue to decline."
The job losses were far-reaching: manufacturing lost 90,000 jobs, construction shed 49,000, professional and business services saw a decline of 51,000, and retail trade employment lost 38,000. Health care, however, added 26,000 jobs.
As the unemployment rate in America increases and President Bush’s tenure draws to a close, all eyes are on President-elect Barack Obama and the Democratic Congress set to take the reins in Washington in January. Will the new leadership provide relief?
Looking for Relief as the Unemployment Rate in America Increases
In a Chicago press conference Nov. 7, the same day the unemployment data were released, Obama acknowledged the job losses and their toll on the workforce, noting, "we’re going to have to act swiftly to resolve it." He went on to say that until Jan. 20, the Bush administration is in charge, but, "Immediately after I become president, I’m going to confront this economic crisis head-on by taking all necessary steps to ease the credit crisis, help hardworking families, and restore growth and prosperity." Among some top priorities Obama mentioned:
- a rescue plan for the middle class "that invests in immediate efforts to create jobs and provide relief to families that are watching their paychecks shrink and their life savings disappear." A fiscal-stimulus plan and another extension of unemployment benefits would be part of that plan;
- policies to help the automobile industry adjust amid the financial turmoil;
- longer-term policies to bolster the economy, such as clean energy, health care, education and tax-relief for middle-class families.
Obama underscored that fixing the situation won’t come easily or quickly–but it can be accomplished through a concerted, non-partisan effort.
While reporting another story for PayScale last week, I talked with sources who speculated on the policy moves Obama might make, and how they could affect American workers. All the speculation is pure conjecture at this point, of course, but one source pointed to something other than hard policies, yet something equally important to rejuvenating the economy: providing workers with a sense of hope and purpose. The new administration, he said, seems well-equipped to give the workforce just that.
- Employment Situation Summary, October 2008 (Bureau of Labor Statistics)
- U.S. Jobless Rate Rises To 14-Year High 6.5 Percent (National Public Radio)
- Jobless Rate at 14-Year High After October Losses (The New York Times)
- Obama Pledges Quick Action on Economic Stimulus (The Wall Street Journal)
- Economists React: Jobs Data ‘Horrible in Every Way’ (The Wall Street Journal)
- Transcript of President-Elect Obama’s First News Conference (The New York Times)
- Current Unemployment Rate Hits Four-Year High (The Salary Reporter)
- Current Unemployment Rate Steady at 5.5 Percent in June (The Salary Reporter)
- A History of U.S. Unemployment Rates (The Salary Reporter)