Sun, Mar 07, 2004 - Page 11 News List

Bush goes back on the defensive after lackluster job data


The Bush administration was pushed back on to the defensive over its handling of the economy on Friday after official figures showed that job creation remains painfully slow, with less than nine months remaining until Americans go to the polls to choose a new president.

News that only 21,000 positions were created last month instead of the 125,000 the market was expecting brought the dollar's two-week long comeback on the foreign exchanges to an end.

"Shockingly low," was the view of Kevin Grice, an economist at American Express Bank.

"The longer non-farm payrolls stay weak, the greater the question marks there will be about the sustainability of US economic growth," he said.

The figures cast doubt on expectations that the US Federal Reserve will reverse its policy of rock-bottom interest rates in the near future, taking the shine off the market's recent enthusiasm for the dollar. Within a few minutes of the jobs data being released, the greenback fell more than 1 percent against the euro, and by midday in New York was at US$1.2410, nearly a 2 percent drop.

Job gains in January were revised as well, to show a pick-up of just 97,000 positions, down from the 112,000 first estimated a month ago.

Administration officials were forced to defend their record on job creation, already a weak spot in Bush's re-election campaign.

John Kerry, the Democrat nominee for president, seized on the figures as the latest evidence of Bush's poor handling of the economy.

"At this rate, the Bush administration won't create its first job for more than 10 years. Americans have a clear choice in this election," Kerry said. "They can either suffer with more and more job losses that rip the heart out of our economy or they can give George Bush a new job."

The slow pace of job creation is prompting some job hunters to give up their search. The overall unemployment rate stayed constant at 5.6 percent as approximately 392,000 people left the civilian workforce last month from January.

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