Economy Loses Jobs For The First Time Since 2010 - Opposing Views

Economy Loses Jobs For The First Time Since 2010

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The U.S. economy lost 33,000 jobs over the course of September, ending the longest streak of sustained job growth recorded by the federal government since the 1930s. Economists have attributed the disruption to a pair of hurricanes that battered Florida and Texas.

On Oct. 6, the Department of Labor's Bureau of Labor Statistics released its monthly jobs report, a survey that it has conducted since the 1930s. The latest report found that the U.S. labor market had a net loss of 33,000 jobs in September.

The findings marked the first time the American economy experienced a drop in job growth since September 2010. The U.S. had sustained job growth for 83 consecutive months following the Great Recession, the longest streak recorded by the BLS. That streak is now broken.

The BLS report found the unemployment rate actually dropped to 4.4 percent in August to 4.2 percent, the lowest since February 2001. If that sounds like a contradiction, it is because the BLS bases job growth based on payroll data and measures the unemployment rate based on a survey of American households.

"The difference in these two number is that more Americans are employed, yet many missed a paycheck in September," U.S. Labor Secretary Alexander Acosta said in a statement, reports The Washington Post.

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Economists chalked up the job losses to the damage caused by hurricanes Harvey and Irma in broad swaths of Louisiana, Texas and Florida during August and September.

"This really does look like what happened following Hurricane Katrina 12 years ago, where there were two very soft employment numbers followed by a reassertion of the underlying trend in subsequent months," said chief economist Joe Brusuelas of RSM US LLP.

The BLS report did not analyze the labor market of Puerto Rico, the U.S. territory that had been ravaged by Hurricane Maria in September.

The leisure and hospitality sector of the U.S. labor market had a drop in 105,000 during September. This reduction actually resulted in the average wages in the overall economy rising by 12 cents per hour, because employees in hospitality tend to be paid less than employees in other sectors.

Republican Rep. Kevin Brady of Texas, the chairman of the House Ways and Means Committee, touted the new jobs report as evidence that Republican lawmakers should pass the GOP tax plan before the end of 2017, The Hill reports.

"In the weeks ahead, the Ways and Means Committee will move forward with pro-growth, pro-middle-class tax reform legislation that Congress will ultimately send to the president’s desk this year, for the first time in 31 years," Brady said.

The House Minority Leader, Democratic Rep. Nancy Pelosi of California, asserted in a statement that the BLS report actually should motivate Republicans to "abandon their job-killing giveaways for the richest and focus on raising wages and creating jobs for hard-working Americans."

Economists generally agreed that the September jobs report data was impacted by the weather and that the U.S. economy was still on a growth trajectory.

But a recent study conducted by the International Monetary Fund warned that the U.S. could expect severe weather to continue disrupting the economy. The IMF report found that rising global temperatures would make devastating hurricanes more common over time and that these storms would chip away at economies, CNBC reports.

"The average country would suffer an additional 0.1 percent of per capita output loss every time it is hit by an average tropical cyclone, with smaller states experiencing 0.2 percent greater damage," the IMF study concluded.

Sources: CNBCThe HillThe Washington Post / Feature Image: Brownpau/Flickr / Embedded Images: U.S. Army/Wikimedia Commons, FEMA/Wikimedia Commons

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