Employment Picture Looking Even Bleaker

One week after the Department of Labor released a very anemic July jobs report, there’s new information that leads to the conclusion that the employment picture is going to get much worse before it gets better:

WASHINGTON — The employment picture is looking bleaker as applications for jobless benefits rose last week to the highest level in almost six months.

It’s a sign that hiring is weak and employers are still cutting their staffs.

First-time claims for jobless benefits edged up by 2,000 to a seasonally adjusted 484,000, the Labor Department said Thursday. Analysts had expected a drop. That’s the highest total since February.

Initial claims have now risen in three of the last four weeks and are close to their high point for the year of 490,000, reached in late January. The four-week average, which smooths volatility, soared by 14,250 to 473,500, also the highest since late February.

Analysts said that the unexpected rise in claims suggests hiring in August won’t be much better than July. The economy added a net 12,000 jobs last month after excluding the loss of temporary census positions. That’s not nearly enough to reduce the unemployment rate, which is currently 9.5 percent.

The jobless claims report “represents a very adverse turn in the labor market, threatening income growth and consumer spending,” Pierre Ellis, an economist at Decision Economics, wrote in a note to clients.

If nothing else, this would seem to be final confirmation of the fact that the February 2009 stimulus package was a completely failure in the sense that it did next to nothing to either reinvigorate the economy, or create the conditions that would lead employers to start hiring again. At this point, it’s unclear what can be done to bring that about.

FILED UNDER: Economics and Business, US Politics, , , , , ,
Doug Mataconis
About Doug Mataconis
Doug Mataconis held a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020. He passed far too young in July 2021.


  1. Gerry W. says:

    The bottom line, no matter what anyone does, is that you cannot create jobs if you are sending jobs overseas.

  2. Steve Plunk says:

    Unclear?  It’s very clear what needs to be done and what needs not to be done.
    Starting with what not to do, don’t implement a health care overhaul that no one understands.  Don’t push a complex scheme of taxing energy and creating a shady market for carbon credits or some other such nonsense.  Don’t demonize American business.  Don’t raise taxes.  Don’t increase regulations that are already onerous and yield diminishing returns.
    What to do?  Start with a promise to not raise taxes or increase regulations.  Give up on global warming based legislation.  Create a national energy policy that decreases foreign dependence and provides more stable supplies.  Recognize the value of shale gas and promote it’s development.  Scrap the current version of health care reform and start over with smaller bills that concentrate on cost controls and can be gauged and adjusted.  Offer a payroll tax holiday for business that would spur confidence, loan programs only put business further in debt.
    The fear of a government controlled by progressives has proven to be a self fulfilling prophecy.  We saw it coming, we hunkered down, the economy tanked.  Until we see something akin to an all clear there will be no confidence, no spending, no recovery.

  3. Zelsdorf Ragshaft III says:

    The lies told by Dems running for congress in 2006 was the beginning.  It took two years for them to put the economy in the tank.  Blame Bush all you want, but Congress is the holder of the purse strings.  Steve Plunk clearly stated what needs to be done.  Doug, for you to suggest there is nothing that can be done denies history.  Kennedy knew what to do, so did Reagan and Bush.  Cut government spending in areas that can be cut and cut taxes.  This tactic has worked every time.

  4. reid says:

    Shorter Steve: It’s all the commie Democrats fault, waaah!

  5. reid says:

    The Republican plan in good times?  Cut taxes.  In bad times?  Cut taxes.  What could go wrong?

  6. An Interested Party says:

    “The fear of a government controlled by progressives has proven to be a self fulfilling prophecy.  We saw it coming, we hunkered down, the economy tanked.  Until we see something akin to an all clear there will be no confidence, no spending, no recovery.”

    As if the economy was just humming along before the fall of 2008, or even the fall of 2006…it must be nice to have such amnesia, as it allows one to whine and place all the blame on the Obama administration…

  7. Steve Plunk says:

    I like the responses from the Left.  Lay out what can be done and they call it whining.  Well how well is your plan working?  That’s right, it’s not.  It’s making things worse by the day yet you will hold on to those socialist dreams of big government equality.  Especially for the more equal government sector.
    The often overlooked drag on the economy is energy prices.  What has the Democratic party done for energy prices?  Made them worse.  They talked cap and trade, they poo poo’s drilling, they demanded special fuel blends, they wasted billions on trendy alternatives that experts say will never supplant traditional petroleum.
    I saw a story yesterday regarding the most expensive home in the world.  It’s in London and is likely to be purchased by Nigerian or Middle Eastern oil wealth.  I guess that’s the alternative to the “corporate greed” the Left warns us about here in the United States.  Tin pot dictators and royal family members controlling what should be our wealth.
    So let’s have it progressives.  What would you suggest besides blaming Bush and calling Republicans whiners?

  8. Gerry W. says:

    And here is the reason to blame Bush. The economy ran on an ideology. The ideology of trickle down or supply side economics and everything else was ignored. After all laissez-faire is the republicans middle name. So we heard “free trade is good” and our jobs went overseas. So we heard to “stay the course” as Bush ran up deficits and debt, and even Cheney said “deficits don’t matter.” Bush did the same “guns and butter” policy as LBJ. And in economics that is a no no. Well, no lessen learned here. With LBJ it was years of inflation. With Bush it is years of deficits and debt.
    We saw the tax cuts used and abused. If you can’t solve the problems under tax cuts, then the tax cuts was a waste of time. It was for the here and now and is spent money. Tax cuts do not have the effectiveness that it once had. The same with the fed and lower interest rates. They can’t go lower than low. They have lost their effectiveness to stimulating the economy. We spent our money in Iraq and not on our own infrastructure. We need at least 2 billion dollars on our infrastructure. And finally, we lost the jobs. So there is simply nothing to stimulate as this country did not invest in the future. So we are where we are. And the do nothing republicans only complain about Obama, and if that is the case, then come up with some answers, instead of tax cuts and free market principles.
    I do agree with Steve Plunk on a national energy policy.
    INVEST IN YOUR COUNTRY, IN YOUR PEOPLE, AND IN THE FUTURE. And get away from failed ideologies.

  9. reid says:

    Steve, I don’t represent the “Left”, despite what you may think.  I’m also not an economist.  But I do recognize stupidity when I see it, and that includes:
    1. Blaming economic conditions on “progressives”, as if nothing happened before Jan 09.  Anyone can see through that partisan garbage.
    2. Blaming conditions on “demonizing business”.  WTF?  Only paranoid wingnuts can see that.
    3. Always, always calling for tax cuts, particularly for the wealthy.
    4. Always, always demanding fewer regulations on industry.
    5. Claiming that “it’s not working”, despite it having taken years to cause the mess we’re in.
    6. Worst of all: Demanding that we go back to doing the same things that got us here!  That’s surely better than continuing the programs that are slowly (okay, very slowly) improving things.

  10. reid says:

    By the way, I largely agree with Gerry W.  Good post.

  11. anjin-san says:

    Good plan Steve. Go back to the Republican policies that led us to the brink of a depression. You really have your thinking cap on today.

  12. Steve Plunk says:

    So I gave it the good part of the day and none of those on the Left managed to propose anything.  Gerry agrees with the energy policy part and I expect other things but none of the left leaners could do anything but offer insults and derision.  That’s why the Democratic party will never again be good for the economy, they have nothing.  No ideas, no plan, no future.
    Come on, at least pick apart my suggestions.  Don’t just say there old or Republican, tell me why they won’t work.  What’s specifically wrong with them and why won’t they kick start the economy?  Anyone?  Bueller?

  13. reid says:

    Whatever, Steve.  You’re a pull-string Republican, saying the same silly things over and over.

  14. An Interested Party says:

    re: Steve Plunk Thursday, August 12, 2010, 22:10

    Actually, the onus is on you…as others have pointed out, many of things you advocate (no comprehensive healthcare reform, cutting taxes, cutting regulations) were put in place during the Bush years, and we see where that got us, as the recession started well before our current president came anywhere near the White House…

  15. anjin-san says:

    >No ideas, no plan,
    Actually, while you have been busy whining, Obama has had one of the most successful legislative sessions of any President in history. So much for “no ideas, no plan”. The stupidity of your statement is self-evident and requires no real rebuttal.
    Is the economy in the weeds? Yes it is. The weeds are not all that bad when you think about the catastrophe that your “plans and ideas” brought us to the brink of.
    It will take a long, long, time to repair all the damage done during the Bush years. Some of the wreckage will still be there after we are gone. It was that bad.

  16. Steve Plunk says:

    Once again, no ideas on what to do for the economy just Republican bashing and blame Bush.  At least shoot down my proposals so we can debate.  Who’s whining now?
    Just one of you, please, give us an idea what liberals would do to help the economy.

  17. Gerry W. says:

    I didn’t want to do this as I posted this a couple times and anyone can challenge me also.
    This is long winded and hope it comes through on the blog. Will split this up.

    1. Fix the antitrust laws that Reagan relaxed. Monopolies and consolidations destroyed jobs.

    Who Broke America’s Jobs Machine? | NewAmerica.net
    2. Invest in your country: That is energy independence for security and jobs. Also a new air traffic control system that will save 12% on fuel. The savings to the airlines can go to build new aircraft. A high speed internet system. Perhaps high speed rail.
    3. Invest in your people: That is mandatory vocational training. We live in a globalized world and you can no longer rely on factories. We have to be an educated society.
    Hudson Institute > Promoting U.S. Worker Competitiveness in a Globalized Economy
    4. Invest in the future: Federal research grants to be given to universities and business to bring out new technologies. Today there are no new jobs to go to for those unemployed. You need new areas of growth. No playing games with embryonic stem cell research.
    Is America Losing Its Mojo? | Print Article | Newsweek.com
    5. Consider an “American job elimination tax” on companies that move out of the country. These companies do not pay middle class wages, healthcare, pensions, social security, or city and state taxes.

  18. Gerry W. says:

    6. Get away from failed ideology. We saw it for 8 years. Tax cuts do not solve problems. Does not prevent recessions. And does not create prosperity. You still have to solve problems. Ideology does not solve problems.
    7. Supporting small business sounds nice and it is heard in Washington, but it does not work in my community as the big business left. That means you cannot have small business as people lost their jobs. Besides, small business will never pay what big business paid in wages.
    8. We are losing the middle class. We cannot compete with 2 billion cheap laborers in the world that want our jobs. There are not enough jobs to go around. Competition is good, but it can be harmful also. All we are doing in this country is build the same business environment so that we can knock the other guy out. A person loses his job and has no place to go to. And the reason is that we did not invest in our country, in our people, and in the future.
    9. Have commissions to cut government spending. It seems to be the only approach to doing this. Obviously, one side or the other will complain, but something has to be done now.

  19. Gerry W. says:

    10. Government appointed jobs and organizations need to be slimmed down. Every 50 to 60 years we need to go through this. There are too many secretaries, deputy-secretaries, under-secretaries, and under-under-secretaries. Information gets loss through the process and government becomes ineffective. The last time this was done was with the Hoover Commission in the late 40’s.
    11. Pour money into new drugs and preliminary medical science. Drugs are becoming            less resistant to diseases. And potential super bugs are coming.
    12. Fix the infrastructure. It is the reflection of our country to the rest of the world.
    Home | Report Card for America’s Infrastructure
    13. And if we have not kept up with it, every school should have physical education. Also wash your hands when you come home to prevent viruses and less trips to the doctor. And as we see so often, stop throwing pop cans, etc. outside the car.
    14. And finally, I don’t think our elected political system works anymore. Every candidate is bought off and it takes huge amounts of money to run a campaign. I would suggest a management team or a turn around specialist to be a president for a couple of years. And there would be a board of directors who he answers to and for the middle class. The parties are riddled with failed ideologies. We can do better than what we have.

  20. An Interested Party says:

    “Once again, no ideas on what to do for the economy just Republican bashing and blame Bush.” 

    As opposed to what you are doing–blaming the recession on Democrats and our current president…which is fine, if you can somehow prove that our economic troubles miraculously started after the election of our current president, or even after the Democrats regained control of the Congress…

  21. Steve Plunk says:

    Thanks Gerry.  I agree with some of what you said and disagree with some but at least you have some ideas. 2, 9, 10, 11, 13, & 14 are all common ground on which to build.

  22. Gerry W. says:

    Wow, about half way there. That would be a success for any president.

  23. anjin-san says:

    It’s pretty easy to see why the right wants to exclude the disaster of the Bush era from the debate. Funny how quick they are to pull Jimmy Carter out of the hat. I am 51, Carter was President when I was in high school. Which administration is more relevant to where we are today?