Bleak job creation numbers could prompt Fed action

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Associated Press

Posted on September 7, 2012 at 11:02 AM

WASHINGTON (AP) — Despite today's bleak numbers on job creation, stocks have been holding fairly steady today. And one economist says it's because investors are now getting more confident that the Federal Reserve will unveil a new bond-buying program next week to try to lift the economy.

John Silva of Wells Fargo says the jobs report will reinforce the Fed's view that "the economy is growing at a sub-par pace."

The jobless rate fell to 8.1 percent from 8.3 percent, but it was only because more people gave up looking for jobs. Employers added just 96,000 jobs in August, a number that was weaker than expected. It's well below the average for this year and last year.

There were other discouraging numbers as well. Hourly pay fell, manufacturers cut the most jobs in two years and the number of people in the work force dropped to its lowest level in 31 years.

Republican presidential candidate Mitt Romney says it shows that President Barack Obama's policies "haven't worked."

But the White House's top economist notes that August marked the 30th straight month of private sector job gains.

Economist Jim O'Sullivan of High Frequency Economics says the numbers show "no sign of momentum fading." He said it's an economy that's "still growing, but pretty modestly."

%@AP Links

201-a-11-(Alan Krueger, chairman, White House Council of Economic Advisers, in AP interview)-"the first place"-White House Council of Economic Advisers Chairman Alan Krueger says the report shows the economy is on the right track. (7 Sep 2012)

<<CUT *201 (09/07/12)>> 00:11 "the first place"

205-a-17-(Beth Ann Bovino, Standard and Poor's economist, in AP interview)-"30-plus year low"-Standard and Poor's economist Beth Ann Bovino says the latest monthy jobless report is worse than it seems on the surface. (7 Sep 2012)

<<CUT *205 (09/07/12)>> 00:17 "30-plus year low"

APPHOTO NYRD107: Trader John Santiago, left, works on the floor of the New York Stock Exchange Friday, Sept. 7, 2012. Stocks are opening mixed on Wall Street following news that the U.S. economy added fewer jobs than expected in August. (AP Photo/Richard Drew) (7 Sep 2012)

<<APPHOTO NYRD107 (09/07/12)>>

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