Unemployment rates are "really ugly numbers"
A job seeker looks through job listings at the East Bay Works One-Stop Career Center on Jan. 9, 2009, in Oakland, Calif. The unemployment rate in the U.S. surged to 7.2% in December, reaching its highest level in 16 years.
TEXT OF INTERVIEW
JEREMY HOBSON: Now let's get to that jobs report and bring in Chris Low, Chief economist at FTN Financial. He's with us live now as he is every Friday. Chris, good morning.
CHRIS LOW: Good morning.
HOBSON: First Chris, most people think this is pretty bad news. You're usually able to find a silver lining, do you see one here?
LOW: No. I wish I could give you some better answer than that. Look, going through all the details in this number, there's only 39,000 new jobs in November. 50,000 if you take government out of the equation. That's not enough, of course, to bring the unemployment rate down over time. We're looking at a 9.8 percent unemployment rate. It is the highest of the year. These are really ugly numbers.
HOBSON: Is this enough to say that we are in -- what a lot of people have been wondering if we're in -- which is a jobless recovery?
LOW: Yeah, I think that's actually a perfect description of what's going. We call it a growth recession, in the economics community. Growth because GDP is up, but it feels like a recession because there's just nothing going on in the job market. And because the labor force grows over time, you've got this upward creep in the unemployment rate. It's a really frustrating situation.
HOBSON: OK -- frustrating situation. I want to find out what's going on down in Washington -- how they're reacting to this. Let's bring in our own Gregory Warner. Chris Standby. Greg, how are people reacting down in Washington to this news?
GREGORY WARNER: No surprises Jeremy. Republicans jumped to turn this news into referendum on tax policy. John Boehner the Republican House Speaker designate issued a statement a little while ago. He criticized 'job killing tax hikes.' Democrats responded by pushing for an extension on jobless benefits and President Obama will respond himself later this morning from the White House.
HOBSON: OK, the other part of this is the Fed and the action that they took just recently. They took a real beating for pumping all this new money into the economy. Does a number like today's change the dynamic on that at all in terms of what you're hearing from people in Washington?
WARNER: Sure, I called Karen Petrou, she's managing partner at Federal Financial Analytics, and she said look if you want to start talking about government and monetary stimulus and you draw that line to job growth, that line has to cross through Wall Street.
KAREN PETROU: The financial market was, is and for the foreseeable future will be a mess and you don't get macroeconomic growth, you don't get recovery, until you have a stable financial market and money is flowing back into the economy to fund new jobs.
HOBSON: Chris, she is pointing the finger at Wall Street. You're here in New York, do you think that investors after seeing today's job number, are looking into the mirror today for answers or are they looking to Washington?
LOW: You know, it's funny. It's actually a remarkable reaction. The stock markets barely down, and the way we're reading that -- talking to traders -- is that the numbers were just so abysmal, they've decided to choose to believe that October's surprisingly good report is the truth, and November's -- until they hear confirming data -- is wrong. In the mean time, though, there is a push in New York for more help from D.C. We'd love to see relief on both frankly, the unemployment benefits and taxes.
HOBSON: Ok Chris Low, chief economist at FTN Financial as well as our own Gregory Warner. Thanks so much to you both.