Mixed economic news is fodder for both campaigns
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The final unemployment report before Tuesday's presidential election offered something for partisans of all stripes: more slow, steady progress for supporters of Democratic President Barack Obama and persistently high jobless rates and more than 12 million unemployed Americans for supporters of Republican challenger Mitt Romney.
The U.S. Labor Department said Friday the nation's unemployment rate rose slightly to 7.9 percent in October as more people looked for work. However, the economy created a better than expected 171,000 jobs during the month.
Most of the job growth came from retail trade, which added 36,400 jobs; health care, where 31,000 jobs were added; and professional and business services, which added 51,000 jobs.
Government employment fell by 13,000, while manufacturing added 13,000 jobs after losing 27,000 in August and September. Amid signs the housing market is beginning to recover, the construction industry added 17,000 jobs last month.
The 7.9 percent rate marks the second consecutive month the jobless rate has stayed below 8 percent. The rate was 8.9 percent a year ago and 7.8 percent when Mr. Obama took office in January 2009, before the full impact of the worse recession since the Great Depression was felt.
The jobless rate topped out at 10 percent in October 2009, when 15.4 million Americans were out of work. Both figures have steadily, but slowly, declined since then. The number of unemployed workers in October was 12.3 million, 170,000 more than there were in September and 1.5 million fewer than a year ago.
The jobless report "is consistent with an economy growing at about a 2 percent rate," said George Mokrzan, director of economics for Huntington Bank.
The number of Americans unemployed for 27 weeks or more increased by 158,000 last month to 5 million, leaving it 14 percent below year-ago levels.
Average hourly earnings for all workers fell 1 cent in October to $23.58 an hour. That is 1.6 percent higher than a year ago.
"The report is better than expected, which should help the incumbent, but not sufficiently so to be a game-changer," said IHS Global Insight economist Nigel Gault.
Economists said the report offers plenty of fodder for both campaigns to capitalize on in the final days of a dead-heat race.
Cornell University economics professor Sharon Poczter said Republicans can capitalize on the report by pointing to the fact "that nothing's changed that much." Mr. Obama can point to the fact that 578,000 people returned to the workforce last month, an indication that many believe their prospects of finding a job have improved, she said.
"That is part of the encouraging news from the jobs report," Ms. Poczter said.
But Mr. Mokrzan said the percentage of Americans working or unemployed but actively looking for jobs remains below historical averages. The labor force participation rate was 63.8 percent in October, down from 64.1 percent a year ago and 66 percent in October 2008.
"That is kind of the unexplained story, the workers who are not coming into the work force because wages are not high enough or because they feel it's too tough to get a job," Mr. Mokrzan said.
Economists were encouraged by upward revisions in the jobs numbers the Labor Department previously reported for August and September. The September number was increased to 148,000 from 114,000 while the August jobs number was raised 50,000 to 192,000.
Separately, the U.S. Commerce Department said factory orders jumped 4.8 percent in September, fueled by orders for aircraft. Excluding transportation, factory orders rose 1.4 percent, double the increase reported in August.
"This year has not been the best year for the economy, but there are positive signs that things are going to get better," Ms. Poczter said.
First Published November 3, 2012 12:00 am