Jobless rate falls, but not all believe it
By PAUL WISEMAN and CHRISTOPHER S. RUGABER The Associated Press October 6, 2012 6:28PM
FILE-In this Monday, Sept. 17, 2012, file photo, job applicants wait for the opening of a job fair held by National Career Fairs in Fort Lauderdale, Fla. Economists forecast that the unemployment rate edged up last month to 8.2 percent from 8.1 percent, according to a survey by FactSet. Employers are expected to have added 111,000 jobs. (AP Photo/Lynne Sladky, File)
Updated: November 8, 2012 12:21PM
WASHINGTON — The U.S. unemployment rate dropped below 8 percent for the first time since the month President Barack Obama took office, a surprising lift for both the economy and his re-election hopes in the final weeks of the campaign.
The rate, the most-watched measure of the country’s economic health, tumbled to 7.8 percent in September from 8.1 percent in August. It fell because a government survey of households found that 873,000 more people had jobs, the biggest jump since January 2003.
The government’s other monthly survey, of employers, showed they added a modest 114,000 jobs in September, but it also showed job growth in July and August was stronger than first thought.
Obama, eager to shift attention from a disappointing performance at the first presidential debate, said Friday that the report showed the country “has come too far to turn back now.” His Republican opponent, Mitt Romney, countered: “This is not what a real recovery looks like.”
The October jobs report comes out Nov. 2, four days before the election, so Friday’s report provided one of the final snapshots of the economy as undecided voters make up their minds.
The September figures were so surprisingly strong that some pundits and at least one member of Congress, Florida Republican Allen West, accused the Obama administration of manipulating the statistics to help the president’s prospects.
Jack Welch, the retired former CEO of General Electric, said on Twitter: “Unbelievable jobs numbers ... these Chicago guys will do anything ... can’t debate so change numbers.”
The unemployment data is calculated by a government agency, the Bureau of Labor Statistics, under tight security and with no oversight or input from the White House.
Keith Hall, a former commissioner of the BLS who was appointed by President George W. Bush, said the numbers could not have been manipulated.
“It’s impossible to do it and get away with it,” he said. “These numbers are very trustworthy.”
Economists offered reasons not to read too much into them, though. Most of the increase in employed Americans came from those who had to settle for part-time work: 582,000 more people reported that they were working part-time last month but wanted full-time jobs.
That is the biggest increase in so-called underemployed Americans since February 2009, during the depths of the Great Recession.
The Labor Department raised its job-creation figures by a total of 86,000 jobs for July and August. The July figure was revised from 141,000 to 181,000, and the August figure from 96,000 to 142,000.
Economic troubles in Europe and Asia also may be taking a toll on American factories. Manufacturing employment dropped by 16,000 in September after falling by 22,000 in August.
But Europe’s ongoing economic crisis, along with a slowdown in China, means demand for U.S.-made goods is drying up and “the days of robust manufacturing payrolls growth are likely behind us,” said Chris Jones, an economist at TD Economics.
Economists were pleased with September’s drop in unemployment because it happened for the right reasons: More Americans got jobs. And the work force grew by 418,000, the most since February, suggesting people are more optimistic about finding jobs. Because 873,000 more people did find work, the number of unemployed fell by 456,000. And that decline pushed the unemployment rate down.