Jobless Figures Show Economy’s Weakness

by James Parks, Sep 5, 2008

The dismal unemployment figures released this morning by the Labor Department are even worse when you look below the surface. While overall unemployment in August reached a five-year high of 6.1 percent, the rate for African Americans hit 10.6 percent, the first time in three years it has been in double digits. In August, the economy lost jobs for the eighth consecutive month. The Economic Policy Institute (EPI) says in its analysis of the jobs report:

in every period since 1948 when payrolls have declined this consistently, the economy has been in an official recession. 

The 10.6 percent unemployment rate among African Americans is up from 9.7 percent in July. The increase in black joblessness was almost exclusively among black women, whose unemployment increased from 8.3 percent to 10.0 percent. Hispanic unemployment also was up more than the average, from 7.4 percent in July to 8.0 percent.

The jump in unemployment occurred exclusively among adults, mostly concentrated among persons 25 years and older. And it didn’t matter how well educated you were. The jobless rate for college graduates rose from 2.4 percent to 2.7 percent, the highest college unemployment rate since August 2004. At the other end of the educational spectrum, the jobless rate for adults with less than a high school diploma jumped to 9.6 percent, the highest rate since May 1996.  

These figures are especially telling during a presidential race whose key issue is the economy. But, says AFL-CIO President John Sweeney, Republican presidential candidate John McCain doesn’t get it. Sweeney says McCain’s acceptance speech at the Republican National Convention:

ignored what the worsening recession is doing to working people and how the continuing decline in housing prices, a global credit crisis and a spike in the costs of energy and food—conditions he and his advisers helped create—are burdening families.

Click here to read Sweeney’s entire statement.

Not only are more workers out of jobs, but they are stuck in unemployment longer. The number of workers who have been jobless for more than six months increased by more than 500,000 over the past year. In August, nearly one in five unemployed workers (19.5 percent) had been unemployed for more than six months, the highest level in more than three years. 

EPI economists Jared Bernstein and Heidi Shierholz say the jobless figures clearly show:

the engine of job growth is not merely stalled, it is solidly operating in reverse, and the job market’s deterioration in August suggests these problems are deepening. There is thus a strong rationale for a second stimulus package, one directly targeted at job creation.

Of the two presidential candidates, Barack Obama is the only one to propose a second stimulus package. He also has proposed tax cuts for the vast majority of taxpayers, including the middle class. McCain supports the Bush administration’s tax giveaways to the wealthy. 

Not only are more workers losing their jobs, they’re losing their homes as well. Home foreclosures and the rate of homes entering foreclosure rose to record highs in the second quarter, the Mortgage Bankers Association reported today. 

In a news release, Jay Brinkmann, the association’s chief economist, said:

The national foreclosure numbers continue to be driven by the hardest-hit states continuing to get much worse.

The increases in foreclosures in California and Florida overwhelmed improvements in states such as Texas, Massachusetts and Maryland, he said.

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