Julia Coronado, chief economist for North America at BNP Paribas in New York, said the U.S. jobless rate will probably remain higher than 8 percent until the Nov. 6 presidential election and is more likely to rise than to fall.
“Certainly with the economy growing at the pace it seems to be growing, we would be more likely to see the unemployment rate tick up than to move lower,” Coronado said today in an interview on Bloomberg Radio’s “Surveillance” with Tom Keene. “Right now, we are very much treading water in growth, in the labor market.”
Federal Reserve Chairman Ben S. Bernanke last week made the case for further monetary easing to reduce an unemployment rate stuck above 8 percent for more than three years, a situation he called a “grave concern.” The government will report later this week that the economy added 127,000 jobs in August, slowing from a gain of 163,000 in July, while the jobless rate remained at 8.3 percent for a second consecutive month, according to the median estimates of economists surveyed by Bloomberg News.
Coronado said she agreed Bernanke that most joblessness has been caused by weak demand rather than structural changes in the economy, such as a mismatch of jobs and worker skills.
“The only real way to bring unemployment down is to have stronger growth,” she said.
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