Today, 1.3 million long-term unemployed workers sit restlessly in Congress' palm. They will be left without federal unemployment benefits just three days after Christmas if Washington fails to rework the budget deal to extend the Emergency Unemployment Compensation Program (EUC).
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Real Unemployment Rate Could Give Obama Heartburn in November
A quirk in how the U.S. government calculates the unemployment rate has made the data look better than it is, some Wall Street experts are saying.
But in a stroke of bad luck for President Barack Obama, that same quirk will mask real improvements to the U.S. unemployment rate over the summer and into the fall, damaging his chances for re-election.
The official Bureau of Labor Statistics (BLS) unemployment rate has fallen from 8.9% in October to 8.3% in January. The number for February, released today (Friday), held steady at 8.3%.
"We think that the improvement over the last few months dramatically overstates the underlying improvement," Andrew Tilton, an economist at Goldman Sachs, told Reuters. "You will not see that rate of improvement going forward."
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Congress' Failure to Extend Unemployment Benefits Could Mean a Blue Christmas for 2 Million Americans
Nearly two million Americans are set to lose unemployment benefits between now and Christmas - the victims of a deadlocked Congress that's been unable to agree on how to pay for extending aid to the long-term unemployed.
Extended unemployment benefits began to expire at midnight Tuesday, cutting off the last lifeline of income and guaranteeing a blue Christmas for thousands of people already struggling to make ends meet.
Lawmakers are at loggerheads over whether to finance an extension with borrowed money, as they did earlier this year when benefits were interrupted for more than a month.
The Jobs Market May Look Bleak, But Your Investments Don't Have To
There's no getting around the fact that the U.S. jobs market is bleak. Ultimately, though, it's a stark reminder that as investors, we should be looking abroad for maximum profits.
Indeed, investors must turn to countries where the number of people working is rising along with standards of living and consumption.
But that's not all.
There are a few companies that have been performing exceptionally well and are poised to bring investors some joy this holiday season. Before we get to those, though, let's take a quick look at the job market.
Slight Job Gains Won't Shrink the High Unemployment Rate
Employment reports released this week show mixed results, but lead to the same conclusion: The high unemployment rate isn't improving any time soon.
U.S. private-sector jobs last month grew by only 42,000, according to a report issued yesterday (Wednesday) by payrolls processor Automatic Data Processing, Inc. (Nasdaq: ADP). ADP revised the number of jobs added in June to 19,000 from 13,000, which fell far short of economists' predictions of 39,000.
The ADP report "shows continued weakness in the jobs market, which is in part caused by the uncertainty in the economy and general business climate," said Gary Butler, ADP's chief executive, in a statement. "American businesses are on the cusp of recovery, but more effective incentives are needed to encourage business investment resulting in the creation of more jobs."
Misguided Policy Paving the Way for a Double-Dip Recession
With unemployment still hovering near 10%, policymakers should be doing all they can to combat joblessness and reinvigorate a recovery that is showing signs of weakness.
But they're not.
Instead, they're reeling in stimulus measures and enabling a double-dip recession, simply for the sake of fiscal austerity.
The Labor Department is expected to report today (Friday) that the unemployment rate held steady at 9.7% in June, or worse, edged up to 9.8%. That would follow yesterday's (Thursday's) disappointing report that showed new claims for jobless benefits jumped by 13,000 to a seasonally adjusted 472,000. The four-week moving average, which smoothes out volatility, rose by 3,250 to 466,500 - its highest level since March.