Bloomberg predicts small rise in unemployment

On Friday, the Department of Labor will release the last monthly unemployment number before the midterm elections, and Bloomberg predicts that it won’t bring good news for Democrats.  The jobless rate in September will rise slightly from August’s 9.6% level and manufacturing will slow for the rest of the year, and that Americans can expect joblessness to remain above 9% for the entirety of 2011, too:

The jobless rate probably rose in September for a second month as the year-old U.S. recovery failed to generate enough jobs to keep up with a growing labor force, economists said before a report this week.

Unemployment climbed to 9.7 percent from 9.6 percent in August, according to the median estimate of 62 economists surveyed by Bloomberg News ahead of an Oct. 8 report from the Labor Department. The data may also show companies added 77,000 workers to payrolls, and total hiring stagnated amid cuts in government staffing as the decennial census wound down.

A lack of jobs is restraining consumer spending, the biggest part of the economy, and underscores the Federal Reserve’s concern that the rebound from the worst recession since the 1930s has been too slow to develop. Economists surveyed by Bloomberg project unemployment will average at least 9 percent through 2011.

Adding 77,000 jobs means another month of moving backward, of course.  The American economy has to add at least 100,000 jobs per month to keep up with population growth and the addition of working-age adults.  Until we get to job-creation levels above that, we will see more people joining the jobless, and until we get sustained growth above 200,000 for a few months, we won’t see those numbers drop.

The news doesn’t get any better in the manufacturing sector, which had been one of the few bright spots in the post-recession period.  The sector’s growth slowed in September according to the survey, sliding 0.4%.  That comes from inventory growth all summer while demand dropped, erasing demand for new orders.

Essentially, Bloomberg says to bet on stagnation for the next year or more.