Grim economic realities endure
With Election Day less than six weeks away, any and all economic news quickly triggers political “talking points” for both parties. But long after the spin and counterspin of this campaign season subside (they will, won’t they?), whoever wins the presidency on Nov. 6 will face severe challenges in removing the stubborn adjective from America’s “jobless recovery.”
On the short-term positive side, the U.S. Labor Department announced Thursday that initial jobless claims fell the previous week to the lowest seasonally adjusted level since July.
On the long-term negative side, though, the Commerce Department reported Thursday that the U.S. economy, as measured by gross domestic product, grew by a mere 1.25 percent in the second quarter. That was a significant drop from the earlier estimate of 1.7 percent — and from the first quarter’s already-mediocre 2 percent.
As Friday’s New York Times put it: “Thursday’s report underscored that the recovery has proved insufficient to pull down the unemployment rate, which has been stuck between 8.1 percent and 8.3 percent all year.”
In other words, happy days aren’t here again — and probably won’t be anytime soon.
Back to the brighter side: Consumer confidence and the housing market are both showing signs of revival.
And as reported on our front page Thursday, “Thanks to increased manufacturing exports and talented human imports, the Charleston area economy has outperformed its regional peers in recent years, according to an ‘economic scorecard.’ ”
That’s an encouraging trend for local residents.
Still, South Carolina’s unemployment rate stayed at a painfully high 9.6 percent last month. The national jobless rate (8.1 percent in August), has been at least 8 percent for the last 43 months — the longest stretch at that sadly elevated level since the Depression. And those unemployment rates would be even higher if millions of Americans hadn’t given up on finding work.
Meanwhile, though both President Barack Obama and Republican White House nominee Mitt Romney insist that they have plans to finally get America out of this jobs rut, a jittery business community remains wary about current and future federal policies affecting their bottom lines.
As Pierpont Securities chief economist Stephen Stanley told The Wall Street Journal after the downer news about declining growth Thursday:
“Businesses have just moved to the sideline in front of the election. They don’t know what their tax outlook is; they don’t know what their regulatory outlook is.”
But they do know that America’s economic outlook remains at best questionable and at worst dismal.
And that grim, ongoing reality transcends election-year politics.