Stephen Foley: When the going gets tough, things get rough

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The Independent Online

US Outlook: Nothing to cheer in yesterday's US jobs report. If the best you can say is that at least the unemployment rate stayed at 9.6 per cent, instead of ticking up to 9.7 per cent, then it is clear September was a very disheartening month.

Private sector job growth of 64,000 is not good at all, particularly since around 100,000 new jobs need to be created each month to keep pace with natural increases in the labour force. But that figure was within the consensus range. What surprised yesterday was the speed with which government employment has fallen.

The loss of the remaining census-counting jobs was already factored in. We already knew that, constrained by laws requiring balanced budgets, state and local governments are being forced to shed jobs. And yet government austerity pushed payrolls down 95,000 across the whole economy, 10 times the forecast decline.

It is becoming clear we have a political climate in which state and local office-holders flaunt their willingness to throw teachers and police out of work as a mark of "toughness". But when the tough get going, the economic going will only get tougher.

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