Against all expectations, the unemployment rate fell slightly in July, to 9.1 percent, according to the Bureau of Labor Statistics, with 117,000 nonfarm jobs added. However, experts are still concerned.
“While I do not think this sounds the all-clear signal, it does quell some of the conversation that the U.S. is falling back into a recession,” Tom Porcelli, chief U.S. economist at RBC Capital Markets in New York, told Reuters. “There are still plenty of headwinds, like Europe. This report pulls us back from the ledge a little bit.”
However, the article also noted that U.S. growth has “stalled,” and “[e]conomists estimate that the budget cuts and expiring stimulus — including a payroll tax cut and emergency unemployment benefits — could subtract more than a percentage point from GDP growth next year.”
“Until recently, most observers believed the American economy was in a slow recovery, albeit one with very disappointing job growth,” read a news analysis for The New York Times.
“Then last week the government announced its annual revision to the numbers for the last several years. New government surveys indicated Americans had spent less than previously estimated in 2009 and 2010 on a wide range of things, including food, clothing and computers. Tax returns showed Americans even cut back on gambling. The recession now appears to have been deeper — a top-to-bottom fall of 5.1 percent — and the recovery even less impressive. The economy is still smaller than it was in 2007.”