- The Washington Times - Saturday, May 3, 2008

The job market remained in a funk last month, with employment and incomes both shrinking, giving ammunition to Democratic presidential candidates whose prospects are strengthened by the economy’s woes.

A jobs report from the Labor Department highlighted the squeeze in which consumers find themselves between declining jobs and incomes and soaring costs for fuel, food and other necessities. Businesses cut hours as well as 20,000 jobs during the month, while hourly earnings posted only a 0.1 percent increase — not enough to offset a loss of weekly income.

The downturn is placing downward pressure on the earnings of the vast majority who remain at work, said Jared Bernstein, an analyst at the Employment Policy Institute and author of a book on America’s pinched middle class.

Weekly earnings actually declined last month by 0.2 percent, and were up only 3.1 percent compared with April 2007 — well below the 4 percent inflation rate. The loss of consumer purchasing power in the last year has forced many people to forgo luxuries and focus on buying only what they really need.

In another measure of the bind people are in, nearly a million people have taken part-time jobs in the past year because they couldn’t find full-time work, the department said. About 5.2 million Americans overall find themselves in that position, including many of the job seekers chatting on a Monster.com board yesterday.

Video: Employers cut 20,000 jobs, overall rate drops

You decide, eh, might as well swallow my pride and take that minimum-wage job at the mall or wherever because you can’t find a career job, said Jacob Tyme, a job hunter in central Florida who hasn’t been able to find work making more than $15 an hour despite having a college degree.

Even though he is frugal, he and his friends have found they simply can’t live on the $5.85 hourly federal minimum wage. This friend of mine that works at the local Gamestop (a mall store), had her hours cut to 4.5 hours a week. No joke! Wow, that’s not even worth the gas in your car to drive to work, right?

The increasingly frustrating job scene is feeding public discontent with the economy and fueling voter support for Democratic candidates who are promising programs to increase jobs and income. Studies have shown that paltry economic growth in the months leading up to the November election usually gives an advantage to the party out of power.

That’s 260,000 jobs lost since the beginning of the year. That’s 260,000 more Americans who won’t have a paycheck to help them cover the rising cost of health care and child care, gas and groceries, said Sen. Barack Obama, Illinois Democrat, calling the news troubling, but not surprising.

That”s what my campaign is about: jobs, jobs, jobs and jobs. And it is why I am focused on providing struggling middle-class Americans real relief right now, said Sen. Hillary Rodham Clinton, New York Democrat.

To help those who have lost jobs, we must focus on promoting effective worker retraining programs, said Sen. John McCain, the expected Republican nominee, who is promoting an agenda of tax cuts, deregulation and free markets much like President Bush’s.

While presidential candidates sparred over the gloomy job outlook, Wall Street took heart that the payroll cuts reported by employers last month weren’t bigger. Investors also found a ray of hope in the unemployment rate ticking down to 5 percent from 5.1 percent as more people reported getting jobs in the department’s separate survey of households.

Wall Street stocks and the dollar posted gains on the news. White House officials also took an upbeat view, noting that the economy should perk up as tax rebates are starting to arrive in taxpayers’ mailboxes, while the jobs data and other recent economic reports failed to provide definitive proof that the economy is in recession.

The [jobs] report does not prove conclusively that the U.S. economy is already in a recession, but it is certainly recessionary in tone, said Roger M. Kubarych, economist at UniCredit Markets. He said the drop in jobs and hours worked suggested the economy contracted at about a 0.8 percent rate during April.

But because the job cuts were smaller than the 80,000 average monthly job losses during the first quarter, he said, It’s certainly evidence that the slowdown in U.S. business activity is not gaining much momentum.

Job losses continued to be concentrated in retail, manufacturing and construction, which reported 134,000 job cuts during the month. But professional and business jobs broke a losing streak at the beginning of the year and rebounded by 39,000, particularly in accounting, architecture, custodial, payroll and human-resource positions.

Job growth also continued undeterred in health care and education, which added 52,000 positions, as well as in government, which added 9,000 jobs, and in hospitality businesses such as restaurants, where jobs grew by 18,000.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2021 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide