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Steve Chiotakis: There’s news this morning from the Labor Department that fewer people last week filed for first time unemployment claims — down to 391,000 last week, which is indicative of perhaps a little positive movement in the job market.
But the unemployment rate is still above 9 percent and in a speech he made last night in Cleveland, Federal Reserve Chairman Ben Bernanke said the country is in an “unemployment crisis.” Tough words.
Marketplace’s Heidi Moore is with us live from New York to talk about it with us. Morning Heidi.
Heidi Moore: Morning Steve.
Chiotakis: So what’s going on here? Why is the Fed so negative all of a sudden on the jobs?
Moore: Well, because this malaise has gone so long, if you, for a little context, look at when economists say the recession started. It was in December 2007, and allegedly ended in June 2009, and ever since then we’ve been in a recovery.
Well, realistically, it doesn’t feel that way. If this isn’t a recession, it walks and talks like one. And this week, a prominent Wall Street banker said to a group of investors this week, “for the bulk of the American population, this is definitely a recession.” We’re not growing enough as an economy to improve employment. And in most recessions, we make up all the jobs that were lost within four years. Now it’s almost four years after December 2007, and we’ve only lost more jobs.
Chiotakis: Is there anything that will change?
Moore: Probably yes in the long term but in the short term, we’re clutching at straws.
I talked to Guy Lebas at Janney Montgomery Scott:
Guy Lebas: I see it as a lack of economic inspiration. There’s always been some single source of economic growth that the U.S. has looked to. And without that inspiration, there’s no reason to add jobs and that has become systemic.
Moore: So what he’s saying is: what’s our next engine of economic growth? We just don’t know right now. And privately, some at the Fed have said they don’t know either. So we have to keep looking for ways to improve the economy, whether its health care, infrastructure, something else, we have to come up with the engine of economic growth.
Chiotakis: To get those jobs. All right, Marketplace’s Heidi Moore in New York for us. Heidi, thanks.
Moore: Thank you.