Monday, July 05, 2004

Bush Cites `Steady Progress' on U.S. Economy After Jobs Report


July 3 (Bloomberg) -- President George W. Bush said the economy is showing ``steady progress'' after the government yesterday said U.S. companies added 112,000 jobs in June, less than half the median forecast.

``With more jobs, and lower unemployment, we are seeing rising consumer confidence, higher incomes, continued gains in the rate of home ownership, and a restored sense of opportunity,'' Bush, 57, said in his weekly radio address. He cited the 10th straight month of payroll growth, increased homeownership rates and lower unemployment than a year ago.

The government reported yesterday that companies added 112,000 jobs in June, less than the 250,000 forecast in a Bloomberg News survey. While the unemployment rate held steady at 5.6 percent, factory employment fell for the first time in five months, the Labor Department said.

Democratic presidential rival John Kerry, 60, said Americans are getting ``second-rate jobs'' and struggling to pay for their families' education and health care.

Four months before the November elections, Bush is focusing on the economy -- an area where polls are showing his job approval has increased -- after continued violence in Iraq dragged down his ratings for handling the war.

The president, who credits $1.7 trillion in tax cuts with fueling the economy's expansion, said he has a plan to continue U.S. economic growth.

``Now that jobs are coming back, we must build on this progress, and help American workers and families continue to meet the challenges of our changing economy,'' Bush said.

Economic Plan

The president's 45 percent job-approval rating is down nine percentage points since January, according to a June 25-28 Wall Street Journal/NBC News poll of 1,025 registered voters.

A 51 percent majority said the war in Iraq hasn't been worth the human and financial costs. On the economy, 45 percent approved of the job Bush is doing, up from 41 percent in May; 49 percent disapproved, compared with 53 percent in May.

In today's address, Bush said his plan for greater economic growth is to not raise taxes, address rising health care costs, ``reduce the burden of frivolous lawsuits that unnecessarily punish the job creators in America,'' and urge Congress to pass an energy bill to curb rising energy costs.

Kerry, a four-term senator from Massachusetts, said the economy hasn't recouped the jobs lost since Bush took office in January 2001. ``We have a million and a half jobs lost, and I don't believe that is the best we can do,'' Kerry said yesterday in Cloquet, Minnesota, at the start of a three-day bus trip in the Midwest. ``We can create millions of jobs in this country.''

`Second-Rate' Jobs

American families are squeezed because the jobs that have been created under the Bush administration pay an average of $9,000 less a year than the jobs that have been lost, Kerry said.

``Don't tell the people getting those second-rate jobs, don't tell the people working two or three jobs at a time, that we can't do better,'' Kerry said yesterday.

At the current pace, the economy will fall short of the 2.6 million new jobs this year that Gregory Mankiw, chief of the White House Council of Economic Advisers, predicted in February, said Stan Collender, managing director in Washington of Financial Dynamics Inc., a business-consulting firm.

Yesterday's Labor Department report showed factory jobs fell by 11,000 in June, the first decline in five months, suggesting caution by employers in the second half of the year.

Bush and his economic aides said that while the hiring pace slowed in June, the recovery remains on track.

Treasury Secretary John Snow said yesterday the increase in hiring is consistent with a ``strong, strong recovery,'' and that private forecasts of 200,000 to 300,000 new jobs a month remain ``reasonable.''

Homeownership is at an all-time high and manufacturing is as good as it's been during the past 20 years, Bush told small- business leaders yesterday at the White House. ``That's very positive.''



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