Jobs Report: Companies Slow to Hire
131,000 jobs were lost in July, unemployment rate stagnant at 9.5 percent.
August 6, 2010 — -- Only about 8 percent of the 8.4 million jobs lost at the peak of the recession have been recovered, leaving millions of Americans still looking for work, according to an analysis by ABC News' Business Unit.
The latest jobs report, released by the Labor Department, showed that 131,000 jobs were lost in July.
Economists told ABC News that in a word, the latest economic news is "troubling."
There are two huge reasons for the loss of those 131,000 jobs: the end of employment for census workers, and state and local governments forced to make cuts now are cutting workers.
Census Workers Gone
Last month marked the end of work for 143,000 temporary census workers.
In the private sector, employers produced just 71,000 new jobs in a country where 14.6 million people are looking for work.
"Seventy-one thousand jobs in July, that's nowhere near where we need to be to get the unemployment rate moving," Wall Street Journal reporter Jon Hilsenrath said. "If anything, it could actually start rising."
The unemployment rate continues to hover at 9.5 percent.
25 Million Unemployed
Factoring in those who have settled for part-time work or who simply have given up, the number of unemployed Americans tops 25 million.
The number of unemployed comes even as some businesses, now leaner and meaner, sit on near record amounts of cash.
Many companies have found more efficient ways to make profits with fewer people. The average work week has increased by one-tenth of an hour, according to the Labor Department.
Why Aren't Companies Hiring?
"Why aren't companies hiring?" Hilsenrath asked. "The question is answered with a single word: uncertainty."
The passage of major legislation in the past year, including health care reform and financial reform, have weighed heavily on the psychology of companies. Even the BP crisis impacts companies still recovering from what some felt was "near death," economists said.
In the 1990s, the tech boom helped pull the United States out of recession. In the last decade, it was the housing sector.
Later, that same sector would hurt millions of Americans, sending them into foreclosure when the housing market went bust.
Manufacturing Adding Jobs
What could help the economy this time?
"If there is a sector that has the potential to drive us out of this, one would have to look at the export sector, and that includes a lot of manufacturing," Hilsenrath said. "That could be the engine for growth that a lot of people can be looking for."