State, local governments set to see record job cuts, layoffs

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Tami Luhby
Yahoo Finance

Don't look to state and local governments to prop up the job market.

To the contrary, this cash-strapped sector is set to go on a record-breaking layoff binge when the new fiscal year starts on July 1.

State and local governments are forecast to shed up to 110,000 jobs in the third quarter, the first time the blood-letting has risen into the triple digits, according to IHS Global Insight.

"We're on a downward path," said Greg Daco, principal U.S. economist at IHS. "It's not looking good."

State and local government employment has been a drag on the economy all year, averaging a loss of 23,000 jobs a month over the past three months. Meanwhile, the private sector has created an average of 180,000 a month during the same period.

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US new jobs plunged in May; jobless rate up

© AFP/Getty Images/File Spencer Platt

AFP

WASHINGTON (AFP) - The number of jobs generated by the US economy plunged in May and inflation continued to erode workers' incomes, deepening the challenge to the Obama administration, official figures showed Friday.

The economy added just 54,000 net new jobs in May, only one-quarter of the February-April pace, while the unemployment rate edged up to 9.1 percent, the Labor Department said.

The private sector, expected to drive the economy as governments slash spending, added a measly 83,000 positions, one-third of the rate of the previous three months.

Americans pessimistic about economy: poll

New York job hopefuls
© AFP/Getty Images/File Spencer Platt

AFP

WASHINGTON (AFP) - Americans are more pessimistic about the economy than they have been at almost any time since the start of Barack Obama's presidency, according to a poll released Friday.

As candidates begin to limber up for the 2012 presidential race, a New York Times/CBS News survey showed 80 percent of Americans think the economy is in bad shape and 39 percent think it is getting worse.

That depth of pessimism is similar to levels seen in the first months of Obama's term, when the economy was still in the throes of recession.

The poll offers the White House painful evidence that rising gasoline prices and stubbornly high unemployment is roiling voters, with Obama personally taking lumps for the malaise.

Some 57 percent of people disapprove of his handling of the economy, more than at any time during his presidency.

The poll was conducted between April 15 and 20, with 1,224 adults surveyed across the United States.

© AFP -- Published at Activist Post with license

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A Grim Record: One In Seven Americans Is On Food Stamps

Jacob Goldstein
NPR

The number of people on food stamps keeps hitting new all-time highs; as of September, nearly 43 million people were using the program, according to figures out this week.

Of course, because of population growth, absolute numbers only tell part of the story. The best way to look at the numbers over a long period of time is as a percentage of the population. And when you do that, you see that we're also hitting new highs.

The criteria for qualifying for food stamps haven't changed much over time, according to Jean Daniel, a spokeswoman for the government agency that oversees the food-stamp program (the program is officially known as SNAP, by the way).

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High jobless rate streak could break '80s record

Job Fair - photo: Mark Wilson/Getty

Paul Davidson
USA TODAY

Not since the early 1980s has the nation's unemployment rate been so grim for so long, a government report due Friday is likely to show.

Many economists predict the report will say that November's jobless rate held steady at 9.6%, making it the 19th consecutive month that the unemployment rate was above 9%. That breaks the post-World War II record set in the 1980s recession.

The dubious milestone shows that even if job growth picks up as expected in coming months, progress will be slow, and it will take years to put a big dent in the unemployment rate.

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The REAL Unemployment Rate Is 22%

The Daily Bell

Details from John William’s Shadow Stats:

The seasonally-adjusted SGS Alternate Unemployment Rate reflects current unemployment reporting methodology adjusted for SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994. That estimate is added to the BLS estimate of U-6 unemployment, which includes short-term discouraged workers.

The U-3 unemployment rate is the monthly headline number. The U-6 unemployment rate is the Bureau of Labor Statistics’ (BLS) broadest unemployment measure, including short-term discouraged and other marginally-attached workers as well as those forced to work part-time because they cannot find full-time employment.

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Applications for jobless aid rise sharply

Christopher S. Rugaber
Associated Press

WASHINGTON — The number of people seeking jobless benefits jumped sharply last week, after two straight weeks of declines.

The Labor Department said Thursday that initial claims for unemployment aid rose by 20,000 to a seasonally adjusted 457,000 for the week ending Oct. 30. Wall Street analysts polled by Thomson Reuters had expected a smaller rise.

The increase comes after claims fell in four of the previous five weeks. Those drops had brought claims to their lowest level since July and raised hopes the job market was improving.


Instead, claims have risen back above the 450,000 level they have fluctuated around all year. They will need to drop below 425,000 to signal sustained job gains.

The weekly applications for unemployment benefits are volatile, but are considered a real-time snapshot of the job market. They reflect the pace of layoffs and indicate whether companies are hiring.

The four-week average of claims, a less volatile measure, rose by 2,000 to 456,000.

Claims fell steadily last year, from about 600,000 in June 2009 when the recession ended to about 470,000 at the end of the year. There has been little improvement since then.

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Are Credit Checks Keeping The Jobless Out Of Work?

Laura Bassett
Huffington Post

After working for the same railroad for 14 years, never missing a house or car payment, Sammy Bailey says he never expected his credit score to keep him out of a job. But after being laid off in March 2009, he soon found himself unable to make payments on his house and his car, and his credit took a big hit.

"My house payment was $800 a month and my truck was $665 a month, and I was only making about $1200 a month on unemployment," Bailey, 42, told HuffPost. "I couldn't afford to keep up with the payments, lost both the house and the car, and that's what caused my credit score to go down."

Bailey said he applied for a new job at Am-Rail in Kansas City, Missouri, three weeks ago but failed to pass the background check because of his poor credit.


"When they run a credit report on you, I guess the score is supposed to determine what kind of employee you are," he said. "I've had very few jobs in my lifetime, and every job I've had I stuck with for a very long time. Seems like they should go off of you, not your credit score."

While the credit check has long been a routine part of the job application process, experts are wondering whether it's still a fair screening tool in the wake of a recession that has left 15 million Americans unemployed and unable to keep up with their bills.

In a meeting of the Equal Opportunity Employment Commission last week to discuss the use of credit history as a discriminatory barrier to employment, a panel of legal experts and social scientists explained how the screening practice may be harmful and unfair to American workers.

"A simple reason to oppose the use of credit history for job applications is the sheer, profound absurdity of the practice," said Chi Chi Wu, a staff attorney at the National Consumer Law Center. "Using credit history creates a grotesque conundrum. Simply put, a worker who loses her job is likely to fall behind on paying her bills due to lack of income. With the increasing use of credit reports, this worker now finds herself shut out of the job market because she's behind on her bills. This phenomenon has created concerns that the unemployed and debt-ridden could form a luckless class."

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World job crisis is a threat to democracy, says IMF head

International Monetary Fund meeting dominated by fears that US job crisis will add to currency tensions with China

Larry Elliot
Guardian

The International Monetary Fund was seeking to defuse growing tensions over global currencies yesterday amid fears that the US will respond to its stubbornly high unemployment figures by slapping tariffs on Chinese goods.

With China refusing to bow to pressure from the US and Europe to revalue its currency, the annual meeting of the IMF was dominated by concerns that Washington is on the point of losing patience with Beijing. Finance ministers and central bank governors gathered in a gloomy mood, expecting no quick fix to the problem – despite a warning from the IMF that failure to tackle the global jobs crisis could threaten democracy.

Latest figures for the American labour market, released on Friday, showed 95,000 jobs were shed in September, adding to the problems of the Obama administration ahead of next month's mid-term elections.


The poor outlook for jobs in the US has alarmed the Federal Reserve, which is expected to announce a fresh wave of quantitative easing next month, and added extra spice to the row between Washington and Beijing.

Dominique Strauss-Kahn, the IMF's managing director, warned that "we face the risk of a lost generation", adding: "When you lose your job, your health is likely to be worse. When you lose your job, the education of your children is likely to be worse. When you lose your job, social stability is likely to be worse – which threatens democracy and even peace. So we shouldn't fool ourselves. We are not out of the woods yet. And for the man in the street, a recovery without jobs doesn't mean much."

Tim Geithner, Obama's treasury secretary, said: "The United States believes that global rebalancing is not progressing as well as needed to avoid threats to the global economic recovery.

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Globalization and Its Discontents

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