Obama: Economy is ‘Headed in the Right Direction’

President Obama was guardedly optimistic in the face of disappointing jobs numbers Friday, saying in remarks that the U.S. economy was “headed in the right direction.”

But, he added, “We are not headed there fast enough for a lot of Americans. We are not headed there fast enough for me either.”

A Drop in Employment After Months of Gains

The president said that the U.S. has created 600,000 jobs this year, a turnaround from 2009, when 3.7 million jobs were lost. He spoke to reporters briefly from Andrews Air Force base, as he headed to West Virginia for a memorial service for Sen. Robert Byrd.

Approximately 125,000 jobs were lost in June, according to numbers released Friday by the Bureau of Labor Statistics. But that number was driven by the approximately 225,000 temporary federal Census jobs that ended, meaning that the rest of the economy created a net 100,000 jobs. President Obama emphasized that point, saying that it showed the sixth straight month of growth in the private sector, which created 83,000 jobs.

But, the Washington Post points out:

The total of 100,000 jobs added, excluding the census, is lower than the 130,000 or so jobs needed every month just to keep up with growth in the labor force, which could put upward pressure on the jobless rate in the months ahead.

Still, the Post says, the June numbers — though weaker than the job creation numbers in March and April — are stronger than the numbers of any of the past 31 months other than those two.

Job growth was strongest in the business services, leisure and hospitality, and education and health care sectors. It was weakest in construction, financial activities, and state and local government, all of which cut jobs.

Some analysts say the numbers are pointing not to a double-dip recession, but to a long, slow recovery.

David Leonhardt in the New York Times writes that the recovery is “losing steam”:

The overall picture isn’t so much of a double-dip recession as it is of a badly wounded economy recovering at a slow pace. But that’s not much to get excited about it.

And said John Silvia, chief economist at Wells Fargo, told the Washington Post that he foresees “No double-dip, but no rapid recovery either.”

Politico says that that could spell trouble for the president and the Democrats in the fall elections:

While it is only a single snap-shot in time, the June jobs figure often takes on outsize political significance in an election year because it comes as Americans are still paying close attention before summer begins in earnest. The unemployment rate has remained near a politically perilous 10 percent in what increasingly looks like a largely jobless recovery, if it is a recovery at all.

The unemployment rate did decrease slightly in June, from 9.7 percent to 9.5 percent, but that decrease came because more workers dropped out of the labor force, giving up on looking for full-time work.