According to the latest report from the Labor Department, unemployment rose slightly to 7.9% in January. This point has been taken by uninformed republican critics as a sign of the sure mismanagement of the economy that they predicted would follow another 4 years having Barrack Obama as president. Economists on the other hand see this as a sign of progress.
Looking closer at the Jobs report, it is interesting to note that in January a total of 157000 jobs were added to the economy. This information when coupled with the rising unemployment rate shows that more discouraged workers are finally reentering the labor force. These workers stopped searching for jobs because there were none available but have now seen the expansion of the economy and the new jobs available as a sign of progress and are now applying for jobs. Their reentry into the labor market raises the unemployment rate and the labor participation rate.
http://blogs.wsj.com/economics/2013/02/01/obamas-jobs-record-looks-better/?mod=WSJBlog&mod=marketbeat
http://blogs.wsj.com/economics/2013/02/01/dont-dismiss-rise-in-unemployment/
http://www.huffingtonpost.com/2013/02/01/january-jobs-report-unemployment-rate_n_2597751.html
It is important that President Obama continues to create more and more jobs becuase our goal is to reach the Natural rate of unemployment between 4%-5%. Although the unemployment rate rose, it is partly due to the fact that more workers entered the labor force; and though they do not all have jobs yet the fact that they have entered the labor force is a good sign for the future.
ReplyDeleteIt is probably very hard for the president to directly control the economy especially given the fact that he has to work with other legislators to create the policies that influence everyone but since he gets the credit when it works I guess it is only fair that he gains the blame when it doesn't work.
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