Americans are waking this morning from the long Thanksgiving weekend with a barrage of financial information hitting them square in the face. What should be a slow month and a thorough review of the year, December will begin with a common theme that so many have spent countless hours debating and discussing: Jobs, Jobs, Jobs!
The Dubai debt crisis will soon populate the back pages of the major newspapers as soon as the unemployed realize that what is happening in the small UAE state has no bearing on their personal finances. What will become the headline is President Obama’s “jobs summit” set to commence on Thursday – the eve of the November Employment Report.
Wall Street consensus is calling for the unemployment rate to hold steady at 10.2%, while economists are predicting payrolls to have shrunk by 120,000 – the smallest drop in almost two years. The current unemployment rate of 10.2% is a twenty-six year high.
“The economy is recovering, but at a distinctly subpar pace,” Jan Hatzius, chief U.S. economist at Goldman Sachs Group Inc. in New York, said in a note to clients obtained by Bloomberg News. “Growth looks too sluggish to lower the 10 percent-plus unemployment rate to a meaningful degree anytime soon.”
As Bloomberg News noted:
Policy makers, with an eye toward congressional elections next year, are likely to zero in on the plight of American workers. President Barack Obama will convene a “jobs summit” at the White House the day before the employment report, and senators will grill Ben S. Bernanke during his nomination hearing to a second term as chairman of the Federal Reserve.
The President has summoned 130 leading experts ranging from Fortune 500 CEOs to professors of highly regarded education institutions to discuss ways to create jobs and stimulate hiring. The summit is expected to help craft a strategy for the Administration that is dealing with an employment crisis that has cost the nation 7.3 million jobs since the beginning of 2008.
“We are going to be bringing together people from all across the country…to explore who we can jumpstart the hiring that typically lags behind economic growth, but we don’t want to wait,” the President said during a cabinet meeting last week. “We want to see if we can accelerate it.”
The President also hopes the Summit results in a confidence boost not just for the unemployed, but also employers who have been apprehensive to hire. According to ABCNews, the job summit members are expected to consider many proposals, such as:
- More stimulus money for construction projects
- Rewards for firms that hire more workers
- More steps to east credit
- Extending unemployment benefits through 2010
The Committee may be met with resistance, as a record-breaking fiscal deficit is sure to cause a roadblock to any incentives culminating from the summit. Many argue that enough money has already been spent to help kick-start the economy, even though the outcome has been less than stellar.
“We need to bring those deficits down, but that’s not something we need to do in the near term,” argues Moody’s Economy.com chief economist, Mark Zandi.
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