Finance Globe

U.S. financial and economic topics from several finance writers.
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April Job Losses Lower Than Expected

American families continue to deal with the stress and pressures of job loss - and a total of 13.7 million unemployed workers.

The Department of Labor report today that non-farm payroll employment continued to decline for April by 539,000 - bringing the unemployment rate up to 8.9%. 5.7 million jobs have been lost since the start of the recession in December 2007.

Somehow, it was still considered good news since analysts had been predicting a loss of 630,000 for April - and investors reacted positively to the government report in early morning trading. We've still lost a lot of jobs, but not as many for April as in recent months - we're still going downhill, just not quite as quickly.

The number of long-term unemployed - those who've been jobless for 27 weeks or more - increased by 498,000 in April to 3.7 million and has risen by 2.4 million since the start of the recession. The number of long-term unemployed is likely to continue to grow, as any economic recovery is expected to be gradual - and businesses remain cautious about taking on the additional expense of hiring new workers.

Job losses were spread far and wide throughout the sectors. In April, 149,000 manufacturing workers lost their jobs, 110,000 workers in the construction field were let go, 122,000 professional and business people were cut, and 47,000 workers in retail trade were slashed from payroll.

Transportation and warehousing eliminated 38,000 jobs, 40,000 jobs in financial activities continue to disappear, the real estate and rental leasing sector cut 15,000 jobs, and leisure and hospitality lost 44,000 jobs in April.

Health care is the one sector in which employment continues to grow - gaining 17,000 jobs in April. The health care sector has gained an average of 17,000 jobs per month for 2009, after an average gain of 30,000 positions per month for 2008.

Federal government jobs also increased by 66,000 in April, mostly due to the hiring of temporary workers in preparation for the 2010 Census.

Labor Secretary Hilda Solis said that the numbers "reflect the urgent needs of Americans, and they are the focus of this administration's immediate action and relief." But she offered hope in closing her statement, "As the comprehensive plan of the administration takes hold, we have begun to see signs of recovery. We've seen the financial system and the housing market stabilize. New jobs are being created as ground has broken on thousands of new infrastructure projects in all 50 states."

President Obama said of the new data, "The unemployment rate is at its highest point in 25 years. It underscores the point that we're still in the midst of a recession that was years in the making and will be months or even years in the unmaking; and we should expect further job losses in the months to come."

"Although we have a long way to go before we can put this recession behind us, the gears of our economic engine do appear to slowly - to be slowly turning once again. Consumer spending and home sales are stabilizing; construction spending is up for the first time in six months. So step by step, we're beginning to make progress," Obama said.

Obama also spoke of the value of a college degree and said that those without one are twice as likely to be unemployed as those with a higher education degree, and that the average college graduate earns 80% more than someone who only has a high school education.

He once again encouraged "every American to to commit to at least one year or more of higher education or career training."

"So today I'm announcing new steps we are taking to do exactly that - to give people across America who have lost their jobs the chance to go back to school today to get retrained for the jobs and industries of tomorrow."

Currently, many states discontinue unemployment benefits for recipients who begin technical training programs or enroll in college. And to make the situation even worse, those displaced workers often don't qualify for federal aid to pay their education expenses - due to the fact that many of them earned a decent salary just a year ago, before they lost their job. Losing those benefits can make it unaffordable and nearly impossible for workers to retrain into a new skill.

"Well, that doesn't make much sense for our economy or our country. So we're going to change it," Obama said. "First, we'll open new doors to higher education and job training programs to recently laid-off workers who are receiving unemployment benefits." He said the next step will make it easier for more people to receive federal Pell grants to help pay their education bills.

The Secretary of Education, Arne Duncan, and Secretary of Labor, Hilda Solis, will work closely with states and institutions of higher learning to encourage them to allow these changes, and to inform workers receiving unemployment benefits of the training programs and financial support available to them.

Obama said that Department of Education and the Department of Labor have created a new website called www.opportunity.gov to help workers learn about take advantage of these opportunities.

Obama also said that Dr. Jill Biden, a community college professor and married to VP Joe Biden, will lead a national effort to raise awareness about what the administration is doing to open the doors to community colleges.

In the next few weeks, Obama said he will "lay out a fundamental rethinking of our job training, vocational education, and community college programs. It's time to move beyond the idea that we need several different programs to address several different problems - we need one comprehensive policy that addresses our comprehensive challenges."




Sources:
The White House
Department of Labor - Bureau of Labor Statistics
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Thursday, 17 October 2019

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