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July 23, 2014

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U.S. jobless rate falls below 8 percent for first time in nearly 4 years

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Lynne Sladky / AP

In this Monday, Sept 17, 2012, file photo, Robert Orkin of the company TxT-Alert, third from left, talks with job seekers during a job fair held by National Career Fairs in Fort Lauderdale, Fla. The U.S. unemployment rate fell to 7.8 percent last month, dropping below 8 percent for the first time in nearly four years.

WASHINGTON — The U.S. unemployment rate fell to 7.8 percent last month, dropping below 8 percent for the first time in nearly four years and giving President Barack Obama a potential boost with the election a month away.

The rate declined from 8.1 percent because the number of people who said they were employed soared by 873,000 — an encouraging sign for an economy that's been struggling to create enough jobs.

The number of unemployed Americans is now 12.1 million, the fewest since January 2009.

The Labor Department said employers added 114,000 jobs in September. It also said the economy created 86,000 more jobs in July and August than the department had initially estimated.

Wages rose in September. And more people started looking for work.

The revisions show employers added 146,000 jobs per month from July through September, up from 67,000 in the previous three months.

The 7.8 percent unemployment rate for September matches the rate in January 2009, when Obama took office. In the months after Obama's inauguration, the rate rose sharply and had topped 8 percent for 43 straight months.

The decline in the unemployment rate comes at a critical moment for Obama, who is coming off a weak debate performance this week against GOP challenger Mitt Romney.

The September employment report may be the last that might sway undecided voters. The October jobs report will be released only four days before Election Day.

Romney released a statement that focused on the job figures, which declined in September from August. He also noted that manufacturing has lost 600,000 jobs since Obama took office.

"This is not what a real recovery looks like," Romney said in a statement.

But Sal Guatieri, an economist at BMO Capital Markets, said the report signals improvement.

"An overall better-than-expected jobs report, consistent with most recent data that suggest the economy is gaining some momentum," Guatieri said in a note to clients. "The sizeable drop in the unemployment rate could lift the president's re-election chances following a post-debate dip."

Labor Secretary Hilda Solis was asked on CNBC about suspicions that the Obama administration might have skewed the jobs numbers to aid Obama's re-election prospects.

"I'm insulted when I hear that because we have a very professional civil service," Solis said. "I have the highest regard for our professionals that do the calculations at the (Bureau of Labor Statistics). They are trained economists."

After the jobs report was released, the Dow Jones industrial average gained 60 points in the first hour of trading. Broader stock indexes also rose.

The yield on the 10-year U.S. Treasury note climbed to 1.73 percent from 1.68 percent just before the report. That suggested that investors were more willing to take on risk and shift money from bonds into stocks.

The job market has been improving, sluggishly but steadily. Jobs have been added for 24 straight months. There are now 325,000 more than when Obama took office.

The number of employed Americans comes from a government survey of 60,000 households that determines the unemployment rate. The government asks a series of questions, by phone or in person. For example:

Do you own a business? Did you work for pay? If not, did you provide unpaid work for a family business or farm? (Those who did are considered employed.)

Afterward, the survey participants are asked whether they had a job and, if so, whether it was full or part time. The government's definition of unemployed is someone who's out of work and has actively looked for a job in the past four weeks.

The government also does a second survey of roughly 140,000 businesses to determine the number of jobs businesses created or lost.

The September job gains were led by the health care industry, which added 44,000 jobs — the most since February. Transportation and warehousing also showed large gains.

The revisions also showed that federal, state and local governments added 63,000 jobs in July and August, compared with earlier estimates that showed losses.

Still, many of the jobs the economy added last month were part time. The number of people with part-time jobs who wanted full-time work rose 7.5 percent to 8.6 million, the most since February 2009.

But overall, Friday's report dispelled some fears about the job market.

The "U.S. could be growing jobs at a marginally faster pace than feared mid-summer," Guy LeBas, a strategist at Janney Capital Markets, wrote in a research note. "Even with the issues in Europe and slowing production in China, U.S. economic activity does not look to be bearing the brunt of global downside, at least not anymore."

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  1. By reading this article, you helped save or create 10 jobs...

  2. The jobs market is increasing. It should be better. However, don't forget what kind of mess the country was in 4 years ago. The President is doing a good job in the face of opposition from the Republican congress.

    We don't need a new president, we need a new congress. President Obama wins by 6 to 8 points.

  3. Republicans have become so committed to their own baseless propaganda that reality must be a conspiracy. Never mind that corporations profit margins are at record levels, cash on hand at record levels, stock markets approaching record levels, consumer confidence rising steadily...the unemployment numbers improving is a conspiracy. If that were the case why not just make it 4% 3 years ago?

  4. I think this shows his policies are working and if re elected the unemployment should be down to 7.5% by the end of his second term.

  5. These statistics show that President Obama's administration is doing their damndest to turn this economy around. EVEN after what all the Tea/Republican Party majority in the House are doing to try to throw a monkey wrench in the gears of the American economy.

    All indications show the entire Tea/Republican Party are not only trying to tank the economy for political purposes, but they are trying to get the American voters out here to vote for candidates that have no clue how to govern this country except to go back to failed ideas that haven't worked for thirty years.

    It's on, Tea/Republicans. You had your time. You failed.

    Game on at the voting booths. I've had enough of listening to your hogwash.

    I don't want to not only vote out every one of them I can, but I want to seek nothing but the utter and complete destruction of the entire Tea/Republican Party as a whole. That sorry excuse for a political party needs to pay for the constant radical and extreme over reach agenda they throw out there all the time.

    Scorched earth at the voting booths. I want to wreck the whole Tea/Republican Party. They need to pay for the devastation they have wrought upon America.

    Straight up and down the ballot Democratic Party. To hell with Wrong Way Romney and Wreckless Ryan. Not only that...we been to hell, why would people go Heller?

    Obama, Biden, Berkley and Titus!

  6. "Why ALL OF A SUDDEN, one month b4 the election, would BLS use a "household survey study" that has not been used b4 and is totally unscientific."

    In one sentence, Mark's credibility goes out the window.

    The household survey has been used for DECADES by the BLS, and reported every month.

    "According to Haugen, the BLS has been getting its data for the household survey -- the one on which the unemployment figure is based -- from the Census Bureau since 1942. The BLS took over the responsibility for analyzing the employment and unemployment data in 1959. And Haugen says that survey used in the data collection process has been largely the same since 1994. "

    Here's a nice Washington Post article explaining how it's done... from March: http://www.washingtonpost.com/national/j...

    And Mark thinks the household survey has never been used before? Just another low-information voter...

  7. Apparently there are a lot of people that just look at the number and not the details behind it. As Mark pointed out it's not as clear cut as just static numbers.

    Don't believe me? Read about these people. http://economywatch.nbcnews.com/_news/20...

  8. Mark Traeger: "Why ALL OF A SUDDEN, one month b4 the election, would BLS use a "household survey study" that has not been used b4 and is totally unscientific."

    Complete nonsense. The household survey has been conducted every month since 1940 to calculate unemployment. Nothing has changed in the methodology used http://www.bls.gov/cps/cps_htgm.htm

    Participation rates are falling because the Baby Boom generation is retiring...doubling the current retired demographic from 40 million to 80 million over the next 10 years.

  9. Is this the October "surprise?"

  10. Why are the Republican's desperately spinning unemployment below 8%?

    They just spent multi-millions on an ad-buy in battleground states trumpeting "unemployment above 8%". Now every news broadcast for the next week negates their huge buy. Ouch!

  11. Cooking the Books
    Clinton's favorite recipe:
    Inflation has been largely out of the news since the Clinton regime when the Consumer Price Index (CPI) was revised in an effort to redefine inflation, neutralizing its traditional role as a pesky political issue.

    Since then, consumers have faced various waves of upward trends in pricing fueled by monetary policy and other factors, yet for a long time, American inflation has been near zero for a long time. A brief look at the CPI should help explain why prices are spiking upward while many in government are still talking about low or non-existent inflation."
    "Perhaps a more accurate way of stating the political changes to the CPI is that food andd energy were removed from "headline" CPI reports, similar to the way the government publishes "headline" unemployment numbers that are calculated differently from past methods to make the employment picture better than it really is. So-called "headline" figures are the core numbers released to the media for a quick and easy portrayal of statistics. Complete reports listing all the different indexes and statistics are usually released, but are rarely examined by the general public"
    http://www.helium.com/items/2138568-a-lo...

  12. The TeaNutz have gone mad...

    'Good news' is BAD news!
    It's a LIE!
    It cannot BE!
    Obama 'made it up!'

    Woah!

    If we're going to talk about LIARS,
    we ought to look at the biggest nose around...
    Mitt 'Pinocchio' Romney.

    My fav;

    "Mitt Romney tells 533 lies in 30 weeks, Steve Benen documents them"...

    http://www.patheos.com/blogs/slacktivist...

    http://www.addictinginfo.org/2012/09/27/...

    http://www.youtube.com/watch?v=W_pgfWK3s...

    http://www.mormonthink.com/lying.htm

  13. Clearly this is a vast conspiracy, funded by George Soros, taught to Kenyan-born future BLS employees by Big Bird and their communist professors at Harvard, coordinated by dead voters at ACORN, and finally reported by the big bad lamestream media.

    Right, Mark?

  14. "Please find any report during the past 3.5 years of reporting unemployment #'s that also drug out, made public, printed, reported on this bogus survey (unscientific) and I will make a public apology."

    Barrons, DECEMBER 4, 2010
    "As for the figures, it's especially disconcerting that the two parts of the BLS jobs data--household and establishment--pretty much confirmed each other in November. Sometimes, the surveys diverge sharply. This time, each was downbeat."
    "The household data, based on a survey of 60,000 households nationwide, are the source of the unemployment rate. The establishment data, based on a survey of 410,000 work establishments, are the source of nonfarm payroll employment."
    http://online.barrons.com/article/SB5000...

    Seattle Times, Febrary 4, 2011:
    "When the Employment Situation Summary comes out on the first Friday of every month, it actually contains data from two different surveys -- the Current Employment Statistics survey, from which estimates are made about non-farm employment; and a household survey, known as the Current Population Survey, from which the unemployment rate is calculated."
    http://seattletimes.com/html/businesstec...

    And really, your U-6 numbers are completely debunked by FactCheck.org:

    "Romney calls the U-6 number the "real unemployment rate," but BLS spokesman Gary Steinberg said the agency does not refer to U-6 as any kind of "unemployment rate," real or otherwise, because it includes people who are employed, albeit part-time. The U-3 figure is the "official unemployment rate," Steinberg said, and has been calculated the same way for decades."

    "We should note that Romney has often boasted of the unemployment rate when he was governor of Massachusetts. Whenever he cites that number, it has always been the U-3 figure, never the U-6 that he recently called the "real unemployment rate."
    http://www.factcheck.org/2012/02/whats-t...

    The right has been comparing apples to oranges, comparing the U-6 rate under Obama to the U-3 rate under the Presidents. It's an intentionally dishonest attempt to mislead.

  15. I'm waiting for your apology, Mark.

  16. TEA, the reason that you haven't seen Household Survey results before is that you haven't bothered to look at the BLS reports before. For a long, long time now, the BLS's monthly unemployment report has been based upon two (2) surveys -- one from employers (the Establishment
    survey) and one of household (the Household) survey. Detailed results from both have been published as appendices to the monthly summary.

  17. This story from Market Watch is worth the read for some background information (and no, it does not say the numbers were "cooked."): http://www.marketwatch.com/story/drop-in...

    What it does say is that household survey is far more "volatile" than the establishment survey and any given month should not be taken by itself.

  18. Mark, Kevin already provided a few links and I did a quick search and found 1,000's more.

    What's the old saying, instead of giving a man a fish to feed him for a day, teach him how to fish and feed him for life...anyways...Go to google and click on news, search for "unemployment household survey" then go to the left on the screen and click on 'custom range' and enter any date range you want.

    The results included mainstream and righwing media.

  19. I know of at least one brand new job the white house created : Debate counseling czar....

  20. Let's keep moving forward! There is a dire need for more refinery capacity in California. How about Pres Obama fix this by building a new refinery to help these people save money, and for business economics? The government could run it like they do GM. It is a bad situation out there. This would be bigger than any tax cuts he may have thought about. The very poorest people get $20 or more a week spending money if they cut gas to national levels at 3.50 a gallon...
    http://www.10news.com/news/san-diego-gas...

  21. So just where are those 873,000 new workers? Any way you want to look at it that is a huge jump given the prior months, especially when the establishment data doesn't indicate that number of openings.

    By the way, what criteria will the Fed use to put an end to QE-3?

  22. "So just where are those 873,000 new workers? Any way you want to look at it that is a huge jump given the prior months, especially when the establishment data doesn't indicate that number of openings."

    No, it matches historical changes in September.

    Of the 873,000, 582,000 of the newly employed are part-timers. That part-time job growth fits historically. In September of 2010, 579,000 Americans reported gaining part-time employment. In 2011, 483,000 reported gaining part-time employment.

    Overall, data supports this trend. Retailers tend to add many part-time jobs in September to staff-up for the holidays, and college students return to take part-time jobs on and off-campus.

    Add the reported job growth (114,000) to the upwards revision of July-August (86,000) and you're in the ballpark, Jim.

    Could this be a statistical abberation? An outlier? Could be. Given that the BLS just adjusted 4/11-3/12 upward by 386,000, perhaps the survey has been undercounting job growth for over a year.

    "The Bureau of Labor Statistics announced Thursday it had undercounted job growth, meaning the economy added 386,000 more jobs than previously estimated between April 2011 and March 2012."
    http://thehill.com/blogs/on-the-money/ec...

    Further, the strength in the job market is supported by other independent research:

    "TrimTabs reports that beginning in June, it began to observe an improvement in year-over-year growth in daily income tax withholdings. The upward trend has continued through September. TrimTabs highlights the improvements in real-time income tax withholding data that support the improvement in job growth. Specifically, wages and salaries rose 5.1% y-o-y in September, up from 3.8% y-o-y in August. Assuming that inflation is now running at about 1.7% y-o-y, September real wage and salary growth is 3.4% y-o-y, putting it squarely in the range of moderate economic growth for the first time since March 2011."

    http://www.forexpros.com/analysis/bls-ba...

    If this month is an outlier, Obama's in for a hangover next month.

  23. Anyone who believes this number is too dumb to vote.

  24. For those who have been unemployed for months, even years, it matters little whether the unemployment rate is 14.7%, 7.8% or 1.%. For them, it is 100%.

  25. My husband got a full time job in September, but we are not part of the household survey.

    I would think people would be happy that we are moving. It is a positive, not a negative people.

    However, no need to foam at the mouth. There is still the adjustment report to come and one more monthly report due before the election.

    Excuse me now, I have to go do my voodoo dance. ;-)

  26. Let me try and figure this out. There is a election next month and the unemployment rate has been above 8% for 43 straight months. NOW......a month before the election....unemployment drops below 8%. It sure is "convenient" timing for Obama. Common sense says it's not true. Chicago politics at their best and of course the government never lies!

  27. How much you wanna bet that the unemployment number adjusts up above 8% after the election?

  28. Some of you people need help. And those who don't know who they are.

    In keeping with these wild and crazy "conspiracy theories", maybe since 2009 when Obama took office and then in 2010 when the Tea Party took over the House, the Republicans "cooked" the unemployment/job numbers to make Obama look bad since it is a well-known, documented fact from Day One, their quest was to keep Obama a one-term president.

    This "conspiracy theory" is no different than the BS that some of you Republicans are yapping about that Obama "cooked the books".

    BTW - "Chicago politics" that is often referred to also has Republicans - not only in the City but in the State. So any argument about Obama and his "Chicago-style politics" and "Chicago people" is a weak argument. There are sneaky, lying politicians in each Party.

  29. Enjoy the comments to this article. I am simply amazed at how far the right wing leaning commenters are going with their spew. It's like they MUST fight against any and all good news. ESPECIALLY if it benefits President Obama.

    But what seems to be overlooked by all this hateful talk is the simple fact is they are borderline anti-American in spouting this bull puckey. It's like you're cheering for America to fail!

    This is actually good news. America is starting to emerge out of a deep dark hole, putting people back to work, trying to get this economy to work, trying to get people to spend money and contribute to a failing economy, get our GDP going.

    Again, this is good news, but noooooooooooo! It's time to panic. We MUST listen to Fox News and Rush Limbaugh. The rhetoric has been proven to be propaganda before, but now all of a sudden these entities from the radio/television right wing world are now all of a sudden believable?!?!?

    I am astounded at how the ultra-conservative world just divides this country.

    First it was birthers. Now, since Jack Welch, the former CEO of General Electric, came out with a tweet that says this is wrong, he has now named you people. Thank him. You are now forever known as "Welchers." That guy amazes me. He was in charge of a large company. People told him bad news, he would react, tell people what to do to try to turn it around, monitor it til the company showed profits. Now, he's told bad news, and he FIGHTS THE BAD NEWS?!?! Did he forget everything he learned as a CEO?

    Keep it up, you Welchers. I love hearing your anti-American, anti-good news rhetoric.

    Because the more you upchuck this stuff, the faster the entire Tea/Republican Party is going to disintegrate before everyone's eyes.

    It's coming too. On November 6, 2012, the American people are going to have their say. And the Tea/Republican Party, as a whole, is NOT going to like it.

  30. Headline is WRONG. The unemployment rate SKYROCKETS TO 9.9%--we must include the 2 million illegals just given work permits in VIOLATION OF FEDERAL LAW. Adds 2 million to the workforce and 2 million to the unemployment rolls.

  31. When will the right wing fanatics grow up?

    Good grief! It is as bad as being a traitor to want the country to fail.

    They haven't changed since the JBS of the 60's, still mindless fear and anti-American efforts to undermine our country.

    Anyone who understands the process knows that the figures will be adjusted.

    Don't foam at the mouth! There will be another report before the election and you get another chance to howl again.

    Do you really think people with any common sense pay any attention to you? No, they don't, but it is good for some laughs.

    If you can go through withdrawal from your adrenalin addiction, you might be able to find some happiness in life, in spite of the difficulties. If you can't make it on your own, get some professional help. You can change your life.

    Believe me, I know, I was once lost too, and then I was freed from the brainwashing of right wing extremists.

    While people are in hard times, they need encouragement and support. That is the American way between those who are truly patriotic Americans, hoping and working for good things for our country.