August jobs report: No jobs created

Job seekers wait in line to enter the San Francisco HIREvent job fair at the Hotel Whitmore on in San Francisco, Calif.

Steve Chiotakis: News this morning from the Labor Department that the economy didn't create any jobs and didn't lose any jobs in August. And the unemployment rate didn't change either. It remains at 9.1 percent. Jill Schlesinger is editor-at-large at CBS/MoneyWatch. She's with us live from New York as she is every
Friday morning. Hi Jill.

Jill Schlesinger: Good morning.

Chiotakis: So the takeaway here: Does this confirm that the economy is officially and literally flat?

Schlesinger: Yeah, we are neutral. U.S. growth has stalled in the first half of the year and as a result, employers really did pull back on new hires. I know the whole debt ceiling and August volatility didn't help, but those employers who needed some extra hands, they hired part-timers. The number of people working part time who really want full-time work -- that jumped to 8.8 million from 8.4 million in the previous month.

Chiotakis: And those are people who don't have benefits either, right? Part-time workers.

Schlesinger: Exactly.

Chiotakis: Now President Obama, Jill, goes before Congress on Thursday to unveil a new jobs program. Let's say all the obstacles are out of the way -- the Republicans are out of the way and all his obstacles are gone -- is there anything that the president can do to create some spark?

Schlesinger: If there were no obstacles at all, and rivers ran with chocolate, we could create a 21st century version of the New Deal Works Progress Administration. That would create ton of jobs, they might be low wages, but it would add to the debt. I just think that this comes to the old debate: spending versus debt. There are risks and rewards for both, but if we are not going to do a big program like that, I'm kind of concerned that we're stuck here in neutral.

Chiotakis: And the realization?

Schlesinger: Oh gosh, the realization is this: We just went through a 10-year, horrible period where things were fantasy land. And now we're swallowing the bitter pill. The bitter pill is it takes time to recover from a boom and bust. And this bust period is going to persist and it's not going to change -- that's the price we pay for going on that binge.

Chiotakis: And we're going to see if people have the patience for that. Jill Schlesinger from CBS/MoneyWatch. Jill thanks.

Schlesinger: Take care.

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