JEFFREY BROWN: Economists sifted through a new pile of data today on the state of the U.S. recovery, and the Obama administration lowered its expectations for what’s to come.
Ray Suarez has our report.
RAY SUAREZ: With the August jobs numbers coming tomorrow, today’s raft of reports offered differing clues to the economy’s direction, whether it was manufacturing, retail sales, or unemployment claims. Those first-time applications for benefits fell to 409,000 last week, for the first time in three weeks. The figure has to drop below 375,000 to stimulate long-term job growth.
And major retailers reported better-than-expected sales in August. Even as those numbers suggested some bright spots in the economy, other data out released today were more of a mixed bag. Construction spending dropped by the most in six months to a level half of what economists think of as healthy. On the other hand, manufacturing, which had been expected to contract in August, grew for the 25th straight month.
As to what it all means, here’s Brookings Institution economist Martin Baily.
MARTIN BAILY, Brookings Institution: The numbers you mention were maybe a little bit better, but we certainly haven’t had a sustained set of indicators yet that we’re going to get better growth going forward. I hope we will. We surely can’t get much — that much worse growth than we have had in the first half of the year, but the concerns about a possible double dip I think are real.
RAY SUAREZ: For its part, the White House Budget Office revised its projections on the economy down, putting growth at just 1.7 percent this year, off a full point from a forecast in February. It also forecast a nine percent unemployment rate for next year. That will be cold comfort to millions of unemployed, including the 10,000 who lined up at a jobs fair in Los Angeles yesterday.
MAN: I have applied for, I would have to say, pretty close to over 300 jobs in the last year.
RAY SUAREZ: Economist Baily says there are still two big obstacles to a full-blown recovery.
MARTIN BAILY: One is the debt that’s still hanging over a lot of households. They took on too much debt. And the other is, we built too many houses. And we just haven’t yet reached the point, when you add in the foreclosures as well, where we can get construction spending going again.
RAY SUAREZ: President Obama now plans to detail his jobs plan before a joint session of Congress next Thursday night, Sept. 8. He initially wanted Wednesday, the same night as a Republican presidential debate, but House Speaker John Boehner objected.
White House Press Secretary Jay Carney played down the timing skirmish today.
JAY CARNEY, White House press secretary: Sideshows don’t matter. The economy matters. The American people matter. Jobs matter. And that’s what we’re focused on. That’s why — you know, if Thursday’s the day, Thursday’s the day. We want to give the speech.
RAY SUAREZ: The jobs issue also remained front and center on the presidential campaign trail.
Republican hopeful former Utah Gov. Jon Huntsman delivered his job creation blueprint in a Wednesday speech in New Hampshire.
JON HUNTSMAN, (R) presidential candidate: There is no more urgent priority at this point in our nation’s history than creating jobs and strengthening our economic core. Everything else revolves around it and is dependent on it.
RAY SUAREZ: Another Republican, former Mass. Gov. Mitt Romney, is expected to outline his jobs plan in Las Vegas next week.