Employment Picture Darkens in August

The U.S. employment picture worsened slightly in August as the jobless rate edged higher and 54,000 jobs were lost overall, the government reported Friday.

The unemployment rate rose to 9.6 percent last month after holding steady at 9.5 percent in June and July. The number of people out of work climbed to 14.9 million in August, up from 14.6 million in the previous two months.

Private employers added a modest 67,000 jobs in August, with most of the hires in the health care, mining and temporary services industries. But this gain was more than offset by the government shedding 121,000 jobs from its payrolls, including 114,000 temporary census workers, according to the report by the Bureau of Labor Statistics.

For men age 55 and older seeking work, the labor market was especially difficult. Their unemployment rate rose from 7.7 percent in July to 8.4 percent in August, the highest for that demographic since the government began tracking data in 1948, says Sara Rix, a senior strategic policy adviser at AARP.

The jobless rate for women in that age group remained at 6.9 percent last month, the same as in July.

Danger signs for older workers

"What might explain the sharp jump in unemployment among older men warrants further scrutiny, " Rix says, "but the rise in unemployment for this age group is particularly troubling given the barriers older workers face in their search for employment."

Indeed, among all age groups, a hefty 42.5 percent of jobless workers have been without work for more than six months. That translates to 6.2 million people, 1.1 million of whom were 55 or older.

On Thursday, the Labor Department reported that the number of people applying for first-time unemployment benefits declined by 6,000 to 472,000 in the week ending Aug. 28. It was the second consecutive week that claims fell.

The government said nearly 4.5 million jobless workers filed for continuing jobless benefits during the week ending Aug. 21, down 23,000 from the week before. The data do not include those who have exhausted their benefits but are still out of work.

"The job market appears to be stuck in neutral as employers hang on to the workers they have, but are unable or unwilling to add new workers," says John A. Challenger, chief executive officer of global outplacement consultancy Challenger, Gray & Christmas in Chicago. As a result, he said, the growth in private employment last month was "well short of the level needed to make a dent in unemployment."

The jobless rate has also been rising in many states, according to AARP's "pain index."

Workers feeling the pinch

While the economy continues to stagger, a survey released Wednesday by the jobs website CareerBuilder.com shows that many workers are having trouble making ends meet. The survey of more than 4,400 workers polled between May 18 and June 3 found that:

• Nearly eight in 10 workers (77 percent) were living paycheck to paycheck.

• One in five (22 percent) missed bill payments in the past year.

• One in five (21 percent) cut 401(k) or personal savings contributions in the past year.

• One in three (37 percent) drove less to save on gas expenses.

• One in 10 (12 percent) canceled cable TV or other subscriptions.
  

With millions of Americans feeling the squeeze, many political observers looking ahead to November elections say that the Democrats' control of both branches of Congress is in jeopardy.

Carole Fleck is a senior editor at the AARP Bulletin.