Greenspan Says Job Growth Will Accelerate

[chadtm80]

Greenspan Says Job Growth Will Accelerate `Before Long' as Output Rises
March 11 (Bloomberg) -- The U.S. economy is showing ``increasing signals of recovery'' that should boost job growth soon, Federal Reserve Chairman Alan Greenspan said.

``In all likelihood, employment will begin to increase more quickly before long as output continues to expand,'' Greenspan told the House Committee on Education and the Workforce. ``We have reason to be confident that new jobs will replace old ones as they always have.''

Payrolls rose by 21,000 jobs in February, just a sixth of what economists expected, and 1.6 million Americans have dropped out of the workforce in the past year, the Labor Department said last month. Jobs are a main topic in this year's election, with Democratic challenger John F. Kerry, a Massachusetts senator, saying President George W. Bush hasn't done enough to help.

``New job creation is lagging badly,'' Greenspan said, suggesting that's one reason consumer confidence has fallen. ``Job insecurity is understandably significant when nearly 2 million members of our workforce have been unemployed for more than six months,'' he said.

While ``new hires are going to be picking up reasonably quickly if this economic growth rate continues, I think that considering the possibility of extending unemployment insurance is not a bad idea,'' Greenspan said.

The Fed chairman didn't comment on the level of interest rates in the text of his prepared remarks. He did not suggest when job growth would pick up, although his forecast of imminent hiring was similar to remarks he made in congressional testimony last month.

[Stephanie]

He just can't touch those interest rates though if he expects output to increase. Once the interest rates rise, it'll be more expensive for a company to expand, etc., thus putting a lid on new jobs created.

[blizzard]

One major reason unemployment rates should fall soon is that a huge influx of baby boomers into the ranks of the retired. That will open up alot of jobs for the unemployed. The same issue that has Social Security on the ropes will help alleviate the unemployment rate. Contrary to popular belief, no politician can claim credit for this........although they will try...