Slow Rate of Job Growth and Persisting High Foreclosures

By: karen

Recovery in America is weak thanks to the slow rate of job growth and persisting high foreclosures. Without jobs the people cannot pay for mortgages and foreclosures become inevitable.

An increase in jobs coincided with a huge inflow of spending by the federal government. But the job creation pace has retreated to such levels that it is being outstripped by growth in population. The fading of stimulus spending has resulted in the loss of 131,000 jobs last July as per the Labor Department in both the public and private sectors.

There were 71,000 jobs added in the private segment in last July – it being less than what had been expected.

Mark Zandi of Moody’s Analytics said, “The good news here is we’re not falling off a cliff; we’re getting job growth. But obviously this is not enough. If we don’t see better job growth this year and next the recovery is in jeopardy”.

Unless the recovery pace of the economy picks up speed, nearly 15 million Americans out of the job line thanks to the recession will continue to flounder without a regular income. Without this consumer spending cannot get a boost and even the weak recovery will become difficult to retain its toehold.

In July the rate of unemployment continued to cling on to 9.5% – less then the peak of the recession when it was 10.1%. But the figure does not fully tell the story of those who are in need of jobs. Diane Swonk of Mesirow Financial said, “We’ve seen the unemployment rate drift down because people dropped out of the labor force in recent months rather than join it.

That’s the opposite of what you’d be seeing a year into the recovery when people you hope are rejoining the labor force because the job prospects are getting better.”

Last July manufacturing showed hopeful signs of growth in jobs – especially in the automobile sector. The owners of old cars are now wanting new ones and also the credit situation has somewhat eased explained Mike Jackson of AutoNation. It is one of the biggest car dealers in the country.

But it still at much lower levels than the booming years witnessed at the beginning of this century. The annual sale rate has risen to 11.5 million – not much to crow about. Thus if the auto group has to go back to reach its full height the people must have jobs and that is not possible unless the housing sector is healed.

About the Author

Karen Anne, has been working on foreclosure1.com studying the foreclosures market, helping buyers on the finer points of Foreclosure.

(ArticlesBase SC #3054204)

Article Source: http://www.articlesbase.com/ – Slow Rate of Job Growth and Persisting High Foreclosures

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