TEXT OF INTERVIEW
JEREMY HOBSON: In about 40 minutes the Labor Department will release its latest look at the nation’s job market. This is considered the most important economic indicator of the month. It’ll tell us how many Americans got new jobs in November and what the new unemployment rate is. Right now it’s 9.6 percent.
Let’s go live to John Silvia. He’s chief economist at Wells Fargo Bank and he joins us now. Good morning.
JOHN SILVIA: Good morning, Jeremy.
HOBSON: What are you going to be paying the most attention to in this jobs report this morning John?
SILVIA: I’m looking at the headline number of course, and we expect about 130,000 jobs potentially up to 150,000. But I think more importantly for the average consumer, it’s going to be the income number — the personal income number — which combines the job number with the wages that are being paid. And we expect a nice improvement there.
HOBSON: If we see 130,00 jobs gained in November, do you think that’s good for where we are in the recovery right now?
SILVIA: For where we are right now, that’s a good indication that the average job gain continues to improve over time. Now it’s certainly not signaling a very very strong economic recovery, relative to what we’ve seen in the past. But the biggest problem of course is the housing sector and construction. We’ll probably have another negative job number.
HOBSON: Now earlier this week, Congress did not extend benefits for people who have been out of work for a long time. Right now many economists are saying that is a mistake because there aren’t enough jobs for everyone who wants one. How long do you think until each extension of unemployment benefits isn’t an absolutely vital thing for the economy?
SILVIA: Probably another three to six months because you’re looking at the job gains coming along. And yes, I think it is true that simply that many people just can’t find a job. They’re very qualified but they can’t find a job. But there’s also a whole group of other people who are simply not qualified for the kind of jobs we’re looking for now. When you look at the job report this morning, notice that most of the jobs are in the professional services category. Business services, IT, finance, education and healthcare, and many of the workers who are unemployed are often times factory workers, low are semi-skilled factory workers, and construction workers. Well, it’s very hard for them to transition from one area to another, so I think we have a lot of structural unemployment that’s around.
HOBSON: John Silvia, chief economist at Wells Fargo, thanks so much for your time this morning.
SILVIA: Thank you.