Friday morning the Department of Labor issued the August jobs report. The unemployment rate dropped to 8.1%, and the economy created 96,000 new jobs. The job creation number is lower than the 141,000 created in July, although it outpaced job creation for April, May, and June. The drop in the unemployment rate is largely believed to be a result of the unemployed stopping their work search. The Consumer Price Index remained unchanged.
This jobs report is not bad, and it is definitely not good. The economy is not losing jobs, but it is creating jobs at a very slow rate. The economy lost 8 million jobs between February 2008 and February 2010. Since February of 2010 the economy has recovered just under half of those jobs, at the rate of job creation over the past few months it will take 35 months for the economy to recover the other half of the jobs lost in 2008-10. Obama can point to a lower unemployment rate largely due to Republican efforts to end unemployment extensions which is the primary driver of the lower unemployment rate. One last note, Ron Paul supporters have been telling us for several years that government spending will result in inflation. The CPI remains flat, so when is this inflation going to occur.