Ray of light: US reports new hiring of 103,000 people in September

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Thomas Kurien

Is the US economy lifting itself from the deep hole it had dug itself in? If one goes by just the employment figures for September perhaps things are looking up for the US economy, which has been struggling to avoid another recession.

THE LABOUR department of the US has reported a burst of hiring activity in the US. The news that the US added 103,000 jobs in September has calmed down the stock markets in the US and markets around the world. Overall, the sentiment is positive, the Associated Press reported, quoting the Labour Department. There are signs of increased busienss activity. The length of the average working week has increased and so have wages. This development is an important develpoment as the more hiring takes place and wages rise, the more there will be spending, which will unlock the billions of dollars that companies have saved up and were not putting into the market fearing low consumer demand and liquidity crunch brought about by the sub-prime crisis of 208-09.

The US industries that recorded addition of jobs in September were retail, construction, health care, and temporary help services. But the bad news is that the manufacturing industry cut jobs for the second consecutive month. Ecocomists are worried that the US economy is not gaining momentum - that much-needed push that will kick-start business activity.

While the news of addition of 103,000 jobs is encouraging, the unemployment rate has stayed at 9.1 per cent. It's a matter of concern that unemployment has been hovering at around 9 per cent for the last two years. The US needs to create about 125,000 jobs a month in order to keep up with population growth - and even more jobs to decrease unemployment. Despite postive statistics regarding US Federal Reserve Chairman Ben Bernanke said that economic recovery was "close to faltering" as slow job growth was pegging down consumer confidence.