The unemployment rate has dropped from 6.2 percent a year ago, while employers have added jobs for 11 months in a row, for a gain of 1.5 million jobs since August. The total, however, remains 1.2 million below the peak in March 2001, at the beginning of the recession.
"Economic growth is strong and it's getting stronger," President Bush told a conference of minority journalists in Washington today. "And that's good for everybody in America."
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Bush Campaign: Gary Blank, economic adviser for the Bush-Cheney campaign, offered the GOP ticket's take on the latest economic data. (Aug. 6).
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Kerry Campaign: Jason Furman, economic adviser for the Kerry-Edwards campaign, gave the Democrats' take (Aug. 6).
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Video: Washington Post staff writer Nell Henderson discusses the latest unemployment report.
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Treasury Secretary John Snow said in a statement that the jobs report "is a sign that the American economy is continuing on a path of growth and expansion that the President's tax relief continues to give."
Democratic presidential candidate Sen. John F. Kerry (D-Mass.) said in a statement that, "The president keeps saying we've turned the corner. But unfortunately, today's job numbers further demonstrate that our economy may be making a U-turn instead. . . . We can make it better."
Organized labor criticized the Bush economic record today as well. "Clearly, the economy has not yet recovered from the last recession," said AFL-CIO Executive Vice President Linda Chavez-Thompson, during remarks prepared for delivery to the minority journalists' meeting. "In fact, the Bush administration's economic policies have been nothing but a poison pill for our nation's job market."
The weak jobs data come just as Federal Reserve policymakers prepare for their Tuesday meeting to decide whether to raise their benchmark short-term interest target another notch. Many analysts, as well as most traders in futures contracts tied to the target, expect the Fed to lift the target to 1.5 percent from 1.25 percent as part of its plan to raise it gradually over many months to prevent inflation pressures from building.
Fed Chairman Alan Greenspan said on Capitol Hill last month that the economy had hit a "soft-patch" that likely would pass as the expansion continued. And he emphasized that Fed officials now see more danger in leaving the target extraordinarily low, where it would likely spur inflation over time, than they do in the possibility that raising it might dampen growth.
However that was nearly three weeks ago -- before the July jobs report and others showing that consumer spending plunged in June at the steepest rate since September 2001 and that inflation has eased or stabilized in recent months, depending on the measure. For months, Fed officials have emphasized that they need flexibility in responding to a changing economy in transition and have said repeatedly that they would alter their planned course of rate increases in response to the data.
At the same time, the have worked hard -- and effectively -- this year to warn financial markets ahead of any shifts in their policy. Absent any such public warnings, analysts said today that they doubted the Fed would surprise the markets Tuesday by leaving the target unchanged.
Instead, the Fed's top policymaking committee can alter the language in the statement issued after the meeting to acknowledge the "soft-patch" and say whether they still believe it is likely to prove short-lived. The wording can signal whether the officials think they may leave rates unchanged at their September meeting, the last one scheduled before the election.
The weakness in the July labor market was broad-based, the report showed, with no one industry dragging down the total. Retail, financial services and leisure and hospitality were among the industries with declining payrolls. Those losses were offset by gains among employers in manufacturing, education and health services and professional and business services. More industries lost jobs than added them.
The good news for workers with jobs on private payrolls was that average hourly earnings rose by 5 cents to $15.70 last month, while average weekly earnings grew by $3.25 to $529.09.
The average private workweek lengthened to 33.7 hours in July, a gain of 6 minutes compared with June, but below the May level of 33.8 hours.
Unemployment among blacks or African Americans jumped to 10.9 percent last month from 10.1 percent in June. That was more than double the rate for whites, which dipped to 4.8 percent in July from 5 percent the month before.
The jobless rate for people of Hispanic or Latino ethnicity edged up to 6.8 percent last month from 6.7 percent the month before.
