By Ian McKendry
WASHINGTON (MNI) – Labor Secretary Hilda Solis Friday stressed
the need for Capitol Hill to come to an agreement on raising the nations
debt ceiling and agreeing on a budget.
“I would hope the sooner that they can come to an agreement on
things like that, that there will be more confidence and businesses will
decide to make their plans and hire up more people,” Solis said on a
conference call with reporters Friday.
Solis’s comments came on the heels of new data released Friday by
the Bureau of Labor Statistics which confirmed what other regional and
sentiment surveys had already indicated, that the U.S. economy
materially slowed in the month of May.
Solis said some of the weakness was derived from state and local
municipalities which have been forced to layoff workers as they try and
cut their budgets.
“As states and localities make budget decisions they should cut
judiciously, because their decisions have an impact on jobs and the
direction of our economy,” Solis said.
She added that over the last three months, government job losses
totaled 73,000 and were 29,000 in the month of May.
When asked if there is any concern that some of the Obama
administration’s undertakings to boost job growth, like the payroll tax
credit, have been ineffective, Betsey Stevenson, the chief economist to
Solis, said she thought it actually has been effective despite May’s
weak report.
Stevenson pointed to the average job growth of 207,000 over the
last three months (including May’s report) and said that the month of
April was actually one of the best months in terms of job growth “in a
long time.”
“I would look at the full five months and say that in fact it has
been very effective,” Stevenson said, adding “I think that really does
reflect the package that was signed in December.”
While the payroll tax cut may have given the economy a boost, Solis
said another tax cut to help jobs in the near term is unlikely.
“That is actually something that the White house and members of
Congress have to decide; right now they have other things on their
plate,” Solis said.
“Policy makers should resolve the debt ceiling issue to reduce
market uncertainty and bolster consumer confidence,” Solis said.
** Market News International Washington Bureau: 202-371-2121 **
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