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Economy loses 131,000 jobs; many lost in public sector

Steve Chiotakis Aug 6, 2010
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Economy loses 131,000 jobs; many lost in public sector

Steve Chiotakis Aug 6, 2010
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TEXT OF INTERVIEW

Bill Radke: OK, our top story — the economy lost another 131,000 jobs last month. The government’s official unemployment rate stays at 9.5 percent. Joining us live is Jack De Gan, chief investment officer at Harbor Advisory in Portsmouth, N.H. Hi Jack.

Jack De Gan: Good morning, Bill.

Radke: What is the most important thing for us to take away from this unemployment news?

De Gan: The most important thing for your listeners to focus on is how many private sector jobs were created. And that number was a plus 71,000. And the reason that’s important is that private employers are the real creators of jobs in this country.

Radke: Yeah, so private jobs up, but we lost more public jobs than expected. And overall, what should we make of the news?

De Gan: It’s hard to spin this report positively. Many of the jobs that were lost, 143,000, were temporary Census jobs, and that was much anticipated. I think what was less anticipated was the loss of another 50,000 state and local governemnt jobs, which is an overhang that we’re going to be facing because the stimulus from last year is beginning to run off and those state and local governments are having to face budget deficits.

Radke: Well Congress is about to send $26 billion to the states to head off more layoffs. How much will that help?

De Gan: That will help, Bill. It will push back the date at which these cuts are going to have to be realized. But unless the economy picks up and therefore state and local tax revenues pick up, there are more job losses ahead for those governemnts.

Radke: OK, grim news. Jack De Gan, of Harbor Advisory in Portsmouth, N.H. Thank you.

De Gan: Thank you, Bill.

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