Ben Bernanke, US Economy "Back From The Brink," But Not Jobs
Ben Bernanke, the Chair of the U.S. Federal Reserve says the U.S. Economy is "back from the brink" but strong "headwinds" remain that could stall or slow down recovery in 2010.
Bernanke, speaking at the Economic Club of New York. says those "headwinds," include constrained bank lending and a weak job market--likely will prevent the expansion from being as robust as we would hope."
Bernanke goes on to say "the best thing we can say about the labor market right now is that it may be getting worse more slowly. Declines in payroll employment over the past four months have averaged about 220,000 per month, compared with 560,000 per month over the first half of this year. The number of initial claims for unemployment insurance is well off its high of last spring, but claims still have not fallen to ranges consistent with rising employment."
Indeed, Bernanke provides little comfort to the unemployed in the United States - that a "jobless recovery" (that is where economic output grows but employment does not) is what the economy is experiencing.
Particularly troubling is the unemployment rate among men and the young. The unemployment rate rose by 4% for men between 25- 54 years old 10 10.3% - twice the rate of increase than for women. And for the young, "The unemployment rate among people between the ages of 16 and 24 has risen to 19 percent--and among African American youths, it is now about 30 percent. When young people are shut out of the job market, they lose valuable opportunities to gain work experience and on-the-job training, potentially reducing their future wages and employment opportunities."
Other highlights of Bernanke's speech includes the Reserve's position on Bank Lending, Credit Availability and the U.S. Dollar.