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THE RESET: New jobs report brings subdued reaction

Source : AP
Last Updated: Fri, Jan 04, 2013 22:15 hrs

, analysts, pollsters and financial markets became fixated on one monthly economic report: unemployment. Its trajectory was seen as a good barometer on whether President Barack Obama would be re-elected.

He was. And now the jobs reports have faded to become part of the background noise as Obama heads for his second term, a new Congress is in place and the political landscape remains as divided as ever, the economic outlook as uncertain.

The Labor Department reported Friday that U.S. job growth held up during tense fiscal negotiations in December as employers added 155,000 jobs and the unemployment rate stayed at 7.8 percent.

During the campaign, each new monthly report would open a floodgate of pointed press releases from both campaigns and on camera — and usually contradictory — statements from Obama and vanquished GOP rival Mitt Romney.

Now the reaction stream has slowed to a trickle. U.S. stock markets shrugged off the report for most of the day but showed modest gain at the close. Statements from Washington were muted and sometimes even on the same page. Sort of.

White House economist Alan Krueger said the report shows the economy is still recovering but "more work remains to be done." House Majority Leader Eric Cantor, R-Va., said he was encouraged but "we must do better." Senate Majority Leader Harry Reid, D-Nev., said the economy "continues to grow and create jobs" but "the recovery will not become a reality" until more find work.

The economy has been expanding since mid-2009 but not fast enough to drive the unemployment rate markedly lower. Subdued growth is predicted to continue for some time, meaning the jobless rate may not be back to pre-recession levels of 4-5 percent for years.

Obama remained on vacation in Hawaii on Friday, while the new Congress passed an aid package for Superstorm Sandy victims.

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