The economy failed to add new jobs in August, the first time there has been no increase in net jobs in the United States in 11 months.
The flat performance was down sharply from a revised 85,000 gain of jobs in July, the Labor Department said Friday, and was far below a consensus forecast by economists of 60,000 new jobs. The unemployment rate stayed constant at 9.1 percent in August.
Economists blamed both sluggish demand for goods and services and the heightened uncertainty over the economy’s direction for the slow pace of job creation, saying political deadlock was in effect creating economic paralysis.
“Business confidence surveys have uniformly pointed to businesses who are not laying off workers, but who are holding off on hiring while they wait for a clearer outlook — an outlook that became much cloudier and more volatile” beginning with the debt-ceiling battle in July, said Ellen Zentner, the senior United States economist for Nomura Securities.
Taxes are at historical lows, which proves tax cuts do not work to stimulate the economy. The Stimulus propped up the economy for a short time, but it was not enough by itself to fix the problems. One of the biggest problems is outsourcing of jobs. Democrats proposed bills that would have brought jobs back to America, but Republicans blocked them from even making it out of committee.