June jobs report: Unemployment rate not good

The U.S. economy created a modest 83,000 private sector jobs in June, adding to concern that the economic recovery is tepid at best and highlighting the political danger to President Barack Obama and Congressional Democrats heading into a tightly contested midterm election cycle in which control of the House and perhaps the Senate are at stake.

The unemployment rate ticked down slightly from 9.7 percent to 9.5 percent.

The President, in comments after release of the figures, chose to highlight "the sixth straight month of job growth in the private sector" and the nearly "600,000 jobs created this year," a "stark turnaround," he added, from the massive monthly losses during the recession.

"Make no mistake we are headed in the right direction," he said, "but we're not headed there fast enough for a lot of Americans and not fast enough for me either."

GOP House leader John Boehner (O) said the numbers are a "disappointment for every family and every small business who heard President Obama declare just weeks ago that our economy is ‘getting stronger by the day.’ The writing is on the wall for President Obama’s ‘stimulus’ policies and everyone – taxpayers, economists, and the rest of the world – sees it but him."

The Labor Department reported an overall decline of 125,000 non-farm payroll employment but the number was dragged down by a 225,000 decline in temporary Census jobs. The underlying private sector jobs created represent an increase from the 41,000 positions generated in May but a significant drop from the peak recovery job creation figure of 218,000 new jobs in April.

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 economy is making very limited headway in replacing the nearly 8 million jobs lost since the recession began following the 2008 credit crisis and banking sector meltdown.

The economy has added 593,000 private sector jobs this year but remains 7.9 million below its December 2007 level, according to the Labor department.

The numbers spell significant trouble for Obama and the Democrats heading toward the November midterms, as they have increasingly argued that the $787 billion stimulus package put a solid floor under the economy and is on its way toward creating or saving 3.5 billion jobs.

But Republicans have been withering in their criticism of the stimulus, saying it has failed to live up to Obama's lofty promises and pointing to stubborn unemployment as proof.

“The two things that are growing fastest in this Democrat economy are the size of the federal government and the crushing burden of the national debt. While Americans are working harder and living with less, Washington is saddling them with even more government and insurmountable debt,” Senate Minority Leader Mitch McConnell (R-Ky.) said this morning. “When America truly begins creating lasting private sector jobs that help our economy grow, it will be despite the government, not because of it.” (Continues here)