Sept. 2 - The U.S. labor market saw net job creation of zero in the month of August as the rancid debt debate in Washington and debt troubles in Europe paralyzed hiring decisions. Conway G. Gittens reports.
PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL A startling read of the U.S. labor market. Net job creation in the month of August was ZERO. The number of jobs created in the private sector - offset by the number of jobs lost in the government sector. But even there, there's nothing to smile about. The private sector added only 17,000 jobs in August, a far cry from the 105,000 expected by economists. The only hopeful sign may be from the unemployment rate, which held steady at 9.1 percent for a second month in row. Other than that - there's very little good news in this report, says James Bianco, president of Bianco Research. SOUNDBITE: JAMES BIANCO, PRESIDENT, BIANCO RESEARCH (ENGLISH) SAYING: "Even if you account for the Verizon strike, which was 48,000 workers and sort of added that back in, it's still not a good number, it paints an economy that is decelerating and it paints a job market that continues to slow dramatically over the summer." A slowdown that significantly increases the chances the U.S. is in, or heading back into, a recession, according to Bianco. SOUNDBITE: JAMES BIANCO, PRESIDENT, BIANCO RESEARCH (ENGLISH) SAYING: "If you had to put a gun to my head and said are we in or not- I would say we are or we will be fairly shortly. The story in economics this year has been everybody is overestimated the strength of the economy." But some economists caution against reading too much into August numbers given the impact of the bitter debt debate, a hurricane, and the European debt crisis. Investors, however, believe the chances of a recession have risen, sending stock markets in the U.S. and Europe sharply lower. And that puts pressure on Washington - where President Obama is expected to roll out a jobs plan next week…. a plan that will be closely listened to by more than the 14 million Americans out of work. Conway Gittens, Reuters