Filed under: Capitalism, Economy, Energy, Liberalism | Tags: Hope for the Future Down, New Jobs Way Down, Unemployment Up
The monthly jobs report for June came out today. The economy generated only 18,000 new jobs and the unemployment rate increased to 9.2 percent. The number of unemployed has gone up by 445,000.
May’s estimate of 54,000 new jobs has been revised downward to 25,000.
For comparison, the Reagan recovery in the 1980s, by the 20th month the unemployment rate had dropped from 10.8 percent to 7.5 percent—a 3.3-point drop. Under Obama, the unemployment rate has risen a full percentage point to today’s 9.2 percent.
In order to keep pace with population growth, the economy needs to add between 100,000 and 125,000 jobs per month. Unemployment will rise if employers consistently create fewer jobs. And that is where we are today. If the economy keeps up this trend, unemployment will remain high.
Businesses and investors make decisions on what they believe about the future. They know that today’s large debt levels mean tax hikes, interest rate increases or inflation, and it doesn’t make the future look promising.
On top of those expectations for the future, add the unknown and feared hand of federal regulation. Raising the CAFE standards means a much higher price for new vehicles. Restrictions on drilling mean higher energy prices, which in turn means higher prices for everything. New regulations from the EPA may mean anything from refitting all the lightbulbs, to having your operations shut down. New health care regulations and expense, new energy restrictions, new restrictions on your advertising, new legal challenges, it goes on and on. The current administration is intent on increasing their power and control of the economy, but they have little understanding of the unintended consequences of their actions. Heritage outlines what is needed:
Congress and the White House must take immediate action to get America’s economic house in order and to foster an environment that encourages job creation. Those measures include repealing Obamacare, its employer mandates and tax increases; preventing the Environmental Protection Agency from regulating carbon dioxide; passing tort reform to reduce the cost of meritless lawsuits; expanding trade agreements; permitting more domestic energy production; and cutting spending to avert massive tax increases.