Unemployment Figures are a 'Setback'
Jan. 12, 2010
Isaac Cohen, for HispanicBusiness.com
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The head of the White House Council of Economic Advisers, Christina Romer described the last unemployment figures as a "setback." Last week, the Labor Department released the unemployment figures for December, which against most expectations amounted to a disappointing loss of 85,000 jobs.
With the exception of health care, which gained 22,000 jobs, construction lost 53,000 jobs, manufacturing 27,000, and government lost 21,000 jobs. Even retail, in the busiest month of the year, lost 11,000 jobs.
True, compared to the first quarter of 2009 average monthly job losses of more than 650,000, the December figures still are indicative of a declining trend in unemployment, which remains at 10 percent. This is equivalent to 15 million persons unemployed, with almost half of them losing their job during the last two years of recession.
In a year of legislative elections, in November, a double-digit unemployment figure is ominous for the incumbent. However, with high or low unemployment, incumbents almost always lose seats in mid term legislative elections. Only twice in the last six decades, since 1948, the incumbents have gained seats in mid term elections. In 1998, the Democratic Party did so, benefiting from the longest economic expansion in US history. Also, in 2002, the Republican Party benefited from the national unity which emerged after the terrorist attacks of September 2001.
Therefore, this year, what is at stake is if the Democratic Party will retain the majority it has in both the House and the Senate.
Isaac Cohen is Former Director, Washington Office of the United Nations Economic Commission for Latin America and the Caribbean (ECLAC). He also serves as a commentator on economic and financial issues for CNN en Espanol TV and radio.
Source: HispanicBusiness.com (c) 2010. All rights reserved.
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