After a promising beginning of the year, the pace of job creation slowed substantially in the spring. Economists have become grim about the future, scaling back forecasts of even modest job growth.
“If the economy were near full employment, the pace of job gains would be neither surprising nor disappointing,” said Gary Burtless, a Brookings Institution economist. “In an economy in which the unemployment rate has exceeded 8 percent for 41 months, however, the job gains represent an intense disappointment.”
The downbeat report is likely to put pressure on the Federal Reserve, Congress and the White House to do more to stimulate economic growth and new jobs.
Fed Chairman Ben S. Bernanke has said the Fed stands ready to take new action — perhaps a large bond purchase aimed at pushing down already low interest rates — if the job market deteriorates substantially. But some analysts question whether the Fed has enough ammunition to spark the economy.
Republican presidential candidate Mitt Romney was quick to seize on news of the weak jobs report, calling it evidence of President Obama’s mismanagement of the economy.
“It doesn’t have to be this way,” Romney said at a New Hampshire hardware store. “America can do better, and this kick in the gut has got to end.”
Romney added that corporate taxes are too high, the nation’s regulatory burdens too onerous and U.S. trade policy too restrictive to maximize job creation.
For their part, Obama administration officials said the report underscores the need for Congress to do more to stimulate job creation and the depth of the economic problems the president inherited when he took office more than three years ago.
“I want to get back to a time when middle-class families and those working to be in the middle class have some security,” Obama said in Poland, Ohio, during the second day of his Rust Belt tour. “That’s our goal. We’ve got to tap into the basic character of this country because our character has not changed even though we’ve gone through some tough times the past few years.”
Congressional Republicans and the administration have been at odds over which policies would best promote growth. Among other things, Obama has pushed for more infrastructure spending, but GOP congressmen have balked at new spending.
“The president bet on a failed ‘stimulus’ spending binge that led to 41 months of unemployment above 8 percent. He bet on a government takeover of health care that’s driving up costs and making it harder for small businesses to hire,” said House Speaker John A. Boehner (R-Ohio).