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58–196 2010

S. HRG. 111–655 

THE EMPLOYMENT SITUATION: JUNE 2010 

HEARING 

BEFORE THE

JOINT ECONOMIC COMMITTEE 

CONGRESS OF THE UNITED STATES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

JULY 2, 2010 

Printed for the use of the Joint Economic Committee 

( 

(II) 

JOINT ECONOMIC COMMITTEE 

[Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress] 

HOUSE OF REPRESENTATIVES 

CAROLYN B. MALONEY, New York, Chair 

MAURICE D. HINCHEY, New York 

BARON P. HILL, Indiana 

LORETTA SANCHEZ, California 

ELIJAH E. CUMMINGS, Maryland 

VIC SNYDER, Arkansas 

KEVIN BRADY, Texas 

RON PAUL, Texas 

MICHAEL C. BURGESS, M.D., Texas 

JOHN CAMPBELL, California 

SENATE 

CHARLES E. SCHUMER, New York, Vice 

Chairman 

JEFF BINGAMAN, New Mexico 

AMY KLOBUCHAR, Minnesota 

ROBERT P. CASEY, JR., Pennsylvania 

JIM WEBB, Virginia 

MARK R. WARNER, Virginia 

SAM BROWNBACK, Kansas, Ranking Minority 

JIM DEMINT, South Carolina 

JAMES E. RISCH, Idaho 

ROBERT F. BENNETT, Utah 

ANDREA CAMP, Executive Director 

JEFF SCHLAGENHAUF, Minority Staff Director 

(III) 

C O N T E N T S 

MEMBERS

Hon. Carolyn B. Maloney, Chair, a U.S. Representative from New York .......... 1 

Hon. Kevin Brady, a U.S. Representative from Texas ......................................... 3 

Hon. Elijah E. Cummings, a U.S. Representative from Maryland ...................... 5 

WITNESS

Statement of Dr. Keith Hall, Commissioner, Bureau of Labor Statistics; Accompanied by: Mr. Philip Rones, Deputy Commissioner, Bureau of Labor 

Statistics; and Dr. Michael Horrigan, Associate Commissioner for Prices 

and Living Conditions, Bureau of Labor Statistics ........................................... 6 

SUBMISSIONS FOR THE RECORD

Prepared statement of Representative Carolyn B. Maloney, Chair .................... 24 

Chart titled ‘‘Monthly Change in Private Payrolls’’ ....................................... 26 

Prepared statement of Representative Kevin Brady ............................................ 27 

Prepared statement of Representative Elijah E. Cummings ............................... 28 

Prepared statement of Dr. Keith Hall, Commissioner, Bureau of Labor Statistics, together with Press Release No. USDL–10–0886 ...................................... 29 

Letter dated July 27, 2010, transmitting Commissioner Hall’s response to 

Representative Brady .......................................................................................... 33 

Letter dated July 16, 2010, transmitting Commissioner Hall’s response to 

Representative Maloney ...................................................................................... 34 

(1) 

THE EMPLOYMENT SITUATION: JUNE 2010 

FRIDAY, JULY 2, 2010 

CONGRESS OF THE UNITED STATES, JOINT ECONOMIC COMMITTEE, Washington, DC. 

The committee met, pursuant to call, at 9:36 a.m. in Room 106 

of the Dirksen Senate Office Building, The Honorable Carolyn B. 

Maloney (Chair) presiding. 

Representatives present: Maloney, Cummings, and Brady. 

Staff present: Andrea Camp, Gail Cohen, Colleen Healy, Jessica 

Knowles, Ted Boll, and Robert O’Quinn. 

OPENING STATEMENT OF THE HONORABLE CAROLYN B. 

MALONEY, CHAIR, A U.S. REPRESENTATIVE FROM NEW YORK 

Chair Maloney. The meeting will come to order. I would first 

like to recognize myself for my opening statement. 

Today’s employment report from the Bureau of Labor Statistics 

shows that in June, the economy added 83,000 private sector jobs, 

making June the sixth straight month with employment gains in 

the private sector. 

[The chart titled ‘‘Monthly Change in Private Payrolls’’ appears 

in the Submissions for the Record on page 26.] 

You can see that the light blue is the gains of jobs in the private 

sector. The red, on the so-called V-chart that we use in the Joint 

Economic Committee, is when President Bush was in office. As you 

see in the down part of the valley, at the low point we lost over 

779,000 jobs, during the last month that President Bush was in office. When President Obama took office, it has been a zig-zag, but 

we are trending in the right direction and we are gaining privatesector jobs. 

Since the beginning of this year, in fact, the economy has added 

593,000 jobs in the private sector. As expected, the June report also 

showed a sharp decline in temporary Census workers (government 

workers) causing total nonfarm payrolls to decline for the first time 

this year. 

Additionally, the June employment report showed that the unemployment rate ticked down to 9.5 percent, and the number of unemployed workers declined by 350,000. 

Although the overall unemployment rate has declined from its 

peak of 10.1 percent in October, not all demographic groups are 

seeing the same trends in unemployment rates. For example, the 

unemployment rate for African-American workers continued to rise 

after October, although the current unemployment rate of 15.4 percent is lower than the peak of 16.5 percent. Although the unemVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
2 

ployment rate for women showed little change in the first 5 months 

of 2010, the unemployment rate for women declined in June to 8.3 

percent. 

We have made real progress in the past year. Last June, this 

country lost 452,000 private sector jobs. While these job gains are 

not as robust as earlier this year, the trend is definitely in the 

right direction. The policies that Democrats in Congress quickly 

put into place over the last year are working. 

In addition to overall private-sector job gains, there were gains 

across many sectors in our economy. Manufacturing employment 

has risen for six months in a row, after falling for three straight 

years. Consumer spending has risen every month since October of 

2009. Surveys of both the service sector and the manufacturing sector show that the growth is expected to continue. 

But we have to be patient. The path to recovery is never in a 

straight line. For the millions of workers who lost their jobs, it will 

take time for them to become employed again. We also have to be 

vigilant. The recovery is still fragile and our economy is still vulnerable. In fact, Nobel Laureate Paul Krugman believes that we 

are in the early stages of another Great Depression. 

He recently wrote that this depression, and I quote, ‘‘will be primarily a failure of policy . . . governments are obsessing about inflation when the real threat is deflation, preaching the need for 

belt-tightening when the real problem is inadequate spending.’’ 

I am disheartened that the Senate has failed to extend unemployment insurance benefits, despite the fact that there are still 

14.6 million unemployed workers bearing the brunt of the worst 

economic crisis since the Great Depression. As a result, an estimated 1.7 million unemployed workers will lose benefits by the end 

of next week. 

Some Members of Congress do not want to extend unemployment 

benefits because they believe these benefits create a disincentive 

for people to seek work. 

As this JEC Majority Staff Report shows—this is a report that 

was developed and released recently by the JEC Majority Staff— 

the evidence is very clear: these benefits do not inhibit job seekers 

from vigorously looking for or accepting work. Instead, these benefits provide an enormous benefit to society by stimulating the economy as well as preventing workers from dropping out of the labor 

force. 

Every dollar that an unemployed worker gets, he or she plows 

right back into the economy—because they need to. That helps us 

reduce the deficit. That helps us keep our economy moving. 

Even former Chairman of the Federal Reserve Board Alan 

Greenspan expressed strong support for extensions of unemployment benefits after the first Bush recession. 

In a hearing before the Joint Economic Committee in May of 

2003, Chairman Greenspan stated, and I quote, ‘‘when you’re in a 

period of job weakness where it is not a choice on the part of people 

whether or not they’re employed or unemployed, then, obviously, 

you want to be temporarily generous. And that’s what we’ve done 

in the past, and I think it’s worked well.’’ 

In May 2003, we had fewer than 3 unemployed workers for every 

opening, and the unemployment rate was 6.1 percent. The most reVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
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cent data shows that there are 5 unemployed workers for every 

opening, and the unemployment rate is 9.5 percent. 

Extending these benefits provides stimulus to the economy and 

a social safety net for people who are out of work. It is also fiscally 

prudent, as well. 

Disabled workers who become discouraged and drop out of the 

labor force enter the Social Security Disability Insurance Program, 

which is much more expensive than unemployment insurance benefits. 

We all know that unemployment benefits stimulate the economy. 

Every dollar distributed in unemployment benefits multiplies to 

create over $1.60 in economic activity. 

At a hearing before this Committee in February, Douglas Elmendorf, director of the nonpartisan Congressional Budget Office, testified that extending these benefits is one of the most effective and 

efficient ways to stimulate the economy. And surely it is obvious 

that getting the economy to grow and getting people back to work 

are crucial to getting our deficit under control. 

Moreover, this will be the first time since 1959 that the government will allow unemployment benefits to expire when the national 

unemployment rate was over 7 percent. 

It is time for all Members of Congress to put the American people first. 

I yield back the balance of my time, and yield to my colleague 

and good friend, Mr. Brady. 

[The prepared statement of Representative Maloney appears in 

the Submissions for the Record on page 24.] 

OPENING STATEMENT OF THE HONORABLE KEVIN BRADY, A 

U.S. REPRESENTATIVE FROM TEXAS 

Representative Brady. Thank you, Madam Chairman. And 

Happy 4th of July. I hope you enjoy the holidays. 

I am pleased once again to join in welcoming Dr. Hall before the 

Committee this morning. 

Today’s report is more disappointing news for American workers 

and their families. Total non-farm payroll employment decreased 

by 125,000. And even after excluding the layoffs of 225,000 temporary Census workers, private sector payroll job growth remains 

anemic at 83,000. At this slow pace it will take much of the decade 

to return to normal employment levels. 

While the unemployment rate fell to 9.5 percent, it fell for the 

wrong reason: a precipitous drop of 652,000 workers in the labor 

force or, more importantly, out of the labor force. 

The number of discouraged and other marginally attached workers that have stopped actively seeking jobs rose to 2.6 million, an 

all-time series high. And 6.8 million American workers have remained unemployed for six months or longer. 

In January of last year, President Obama promised that the 

Democrats’ economic program would restore confidence and jumpstart the U.S. economy. Last month, the Conference Board’s Consumer Confidence Index fell dramatically. Consumer confidence is 

flagging because families are frightened by dangerous deficits as 

far as the eye can see. 

4 

And as for jump-starting the economy, two of the Administration’s top economists, Christina Romer and Jared Bernstein, predicted that if Congress were to pass the President’s stimulus bill 

the unemployment rate would remain below 8 percent and nonfarm payroll employment would increase to 137.6 million jobs by 

the fourth quarter of this year. Democrats in Congress did enact 

the American Recovery and Reinvestment Act last year, but this 

stimulus has fallen far short of both of these important projections. 

The growth of real GDP slowed by more than one-half from 5.6 

percent in the last quarter of 2009 to 2.7 percent in the first quarter of this year. 

A number of economic indicators flashed yellow in the second 

quarter, suggesting that economic growth may be sluggish for the 

remainder of this year and next. Americans don’t see an economy 

in recovery. They see a White House seemingly incapable of protecting our beaches or getting people back to work. 

This anemic economic performance after the recession that began 

in December of 2007 is in sharp contrast to the robust economic 

growth that benefitted American workers and their families after 

the 1981–1982 recession. 

The Obama recovery is one-third the recovery of the Reagan recovery, one-third the recovery from the 1981–1982 recession. President Reagan’s economic policies were a tailwind accelerating real 

economic growth. President Reagan pursued pro-growth policies, 

including large reductions in marginal tax rates, deregulation, and 

trade opening. 

Combined with the disinflationary monetary policies under Federal Reserve Chairman Paul Volcker and Alan Greenspan, Reagan 

laid the foundation for two decades of prosperity. 

In contrast, President Obama and Congressional Democrats have 

pursued largely anti-growth policies that have hindered this recovery. Businesses are slow to hire because they fear higher taxes, job 

killing regulation, and a dysfunctional Washington that is ideologically driven and increasingly anti-business. Instead of providing 

encouragement, President Obama and this Congress have given entrepreneurs reason to worry. 

Businesses are not reluctant to hire because they are waiting to 

see what Washington will do for them, they are reluctant to hire 

because they’re afraid of what Washington will do to them. 

Ominously, President Obama and Congressional Democrats are 

insisting on reckless increases in federal spending both now and in 

the future. This puts the triple-A reputation of the U.S. Government into jeopardy for the first time since Secretary of the Treasury Alexander Hamilton miraculously resurrected the finances of 

the United States after the Revolutionary War and put us on the 

road to becoming the world’s economic superpower. 

The Congressional Budget Office projects that under the President’s budget federal spending will grow to 25.2 percent of GDP, 

far above its post-war average of 19.5 percent. A structural budget 

deficit in excess of 4 percent of GDP will persist through the next 

decade. 

Consequently, publicly held federal debt will rise to 90 percent 

of GDP by the end of fiscal year 2020. In The Long-Term Budget 

Outlook released just two days ago, the Congressional Budget OfVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
5 

fice projects that under the alternative fiscal scenario which keeps 

current policies in place, uncontrolled spending growth will cause 

the publicly held federal debt to explode to nearly ten times America’s GDP by the end of fiscal year 2084. 

President Obama and Congressional Democrats are pursuing 

reckless fiscal policies that are clearly unsustainable. Unless their 

excessive spending, deficits, and debt accumulation are quickly reversed, the United States may experience a debt crisis similar to 

Greece. We are putting the future of our children and grandchildren in grave jeopardy. Unlike Greece, however, no one will be 

around to bail us out. 

Dr. Hall, I look forward to hearing your testimony. 

[The prepared statement of Representative Brady appears in the 

Submissions for the Record on page 27.] 

Chair Maloney. The Chair recognizes Congressman Cummings. 

OPENING STATEMENT OF THE HONORABLE ELIJAH E. 

CUMMINGS, A U.S. REPRESENTATIVE FROM MARYLAND 

Representative Cummings. Thank you very much, Madam 

Chair. 

It is so easy to take a look at these reports every month, Commissioner Hall, and have a spirit of fear, as opposed to hope. I have 

chosen hope. 

When I think about from whence we come, and the chart here 

tells the story very clearly, back in January of 2009 we are in deep, 

deep trouble. President Obama came in with a patient—that is, our 

economic system—that was in deep trouble, and was in intensive 

care. He took that situation and turned it around. 

I do not know how many people have ever been in intensive care, 

but it takes time to heal. I do believe that our country has come 

a long way. Is it where we want it to be? No. I wish that we could 

wave a magic wand. And the people who come to me on a daily 

basis in my District, the ones who are saying that they cannot find 

jobs, I wish they could find them. But the fact still remains that 

we have come a long way, and we do have a long way to go. 

I have often said that in these hearings when we hear our jobs 

reports on a monthly basis the question becomes so often when do 

we root for the home team? When do we acknowledge progress? 

When do we give this President, this Administration, this Congress 

credit for what we are accomplishing? 

We must keep in mind that 60 percent of the GDP is consumer 

spending. And my good friend, Mr. Brady, is absolutely right. It is 

about confidence. But the fact remains that one of the things to get 

that confidence going is going back to what the Chairwoman talked 

about in most of her speech this morning. We have got to get people employed, but we also have to make sure that those who are 

not employed and cannot find jobs through no fault of their own 

have some kind of way of making it from day to day. 

You know, sometimes I listen to my colleagues on the other side 

and I wonder. What do you say? And maybe they have never been 

in those situations where a person just could not find a job. So 

what do you say to the person who cannot find a job? Just go and 

die? Just get lost? No empathy? No nothing? Because through no 

fault of their own? 

6 

So I am hoping too, Madam Chair, that the Senate will act. I 

think it is very sad that we leave for a 4th of July vacation, and 

when the fireworks are going off and people are having fun, there 

will be a lot of people throughout our country who will not be able 

to. They are not trying to get down, as I have often said, to Disney 

World; they are just trying to get to the nearest amusement park. 

They are not trying to eat steak; they are simply trying to get 

hamburger. Folks who are just trying to live their lives. People who 

were doing fine a few years ago, doing fine before the country was 

put into intensive care through no fault of their own; doing fine 

while others were getting, at AIG and other big firms, were getting 

major bonuses for millions of dollars for running our country into 

the gutter. 

And so again, one of the things that we did not talk about yet 

this morning is that a lot of people at the beginning of this week 

were saying, oh, the sky is going to fall and we will move from 9.7 

to 9.9. I heard it all week. Not a mumbling word yet about the fact 

that the unemployment rate went down to 9.5. Hello? Rooting for 

the home team. 

We still have a lot to do, but the fact still remains that we have 

come a long way. And the Chairwoman is right. We are going in 

the right direction. And I think that there are things that this Congress can do in working with this President to speed that process 

up. 

And so I choose hope, as opposed to fear. With that, Madam 

Chair, I yield back. 

[The prepared statement of Representative Cummings appears in 

the Submissions for the Record on page 28.] 

Chair Maloney. Thank you very much. 

I would now like to introduce Dr. Keith Hall. He is the Commissioner of the Bureau of Labor Statistics for the United States Department of Labor. The BLS is an independent national statistical 

agency that collects, processes, analyzes, and disseminates essential statistical data to the American public, the United States Congress, other federal agencies, state and local governments, business, and labor. 

Dr. Hall has also served as Chief Economist for the White House 

Council of Economic Advisers. Prior to that, he was Chief Economist for the U.S. Department of Commerce. Dr. Hall also spent 10 

years at the United States International Trade Commission. 

Thank you for your public service. We look forward to your testimony. 

STATEMENT OF DR. KEITH HALL, COMMISSIONER, BUREAU OF 

LABOR STATISTICS; ACCOMPANIED BY: MR. PHILIP RONES, 

DEPUTY COMMISSIONER, BUREAU OF LABOR STATISTICS; 

AND DR. MICHAEL HORRIGAN, ASSOCIATE COMMISSIONER 

FOR PRICES AND LIVING CONDITIONS, BUREAU OF LABOR 

STATISTICS 

Commissioner Hall. Thank you, Madam Chair. 

Thank you for the opportunity to discuss the employment and 

unemployment data we released this morning. 

Nonfarm payroll employment fell by 125,000 in June, and the 

unemployment rate edged down to 9.5 percent. The decline in emVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
7 

ployment reflects a large drop in the number of temporary workers 

for Census 2010. 

The number of jobs in the private sector edged up due to modest 

increases in several industries. Private sector employment has 

risen by 593,000 so far in 2010, but in June was 7.9 million below 

its pre-recession level. 

Over the month, Federal Government employment declined 

sharply. The number of temporary Census workers were dropped 

by 225,000, leaving 339,000 temporary workers on the Census payroll. 

In the private sector, temporary help services employment continued to grow over the month. The industry has added 379,000 

jobs since September of 2009. Employment also rose in management and technical consulting and in business support services in 

June. Amusements, gambling, and recreation gained 28,000 jobs, 

while transportation and warehousing employment was up by 

15,000. 

Mining employment continued to trend up, and the industry has 

gained 56,000 jobs since October of 2009. Employment in manufacturing also continued to trend up in June. The industry has added 

136,000 jobs so far this year. The manufacturing workweek declined by half an hour in June, more than offsetting an increase in 

May. Nonetheless, factory hours remained 1.3 hours above their recent trough. Employment in health care edged up in June. 

Construction employment fell by 22,000; specialty trade contractors accounted for most of the decline. On net, construction employment has shown little change over the last 4 months. 

Turning to measures from the survey of households, the unemployment rate edged down by 0.2 percentage point to 9.5 percent 

in June. Of the 14.6 million unemployed individuals, about 6.8 million have been jobless for 27 weeks or more. In comparison, 1.3 million persons were unemployed for 27 weeks or more when the Recession began. 

The labor force declined in June, following increases earlier in 

the year; the labor force participation rate has declined by half a 

percentage point over the last 2 months. 

The employment to population ratio edged down 58.5 percent in 

June. Among the employed, there were 8.6 million individuals 

working part-time who preferred full-time work. The number of 

such workers has fallen by 525,000 over the past 2 months. 

In summary, payroll employment fell by 125,000 in June, as 

modest growth in the private sector was more than offset by a 

large decline in temporary census workers. The unemployment rate 

edged down to 9.5 percent. 

My colleagues and I would now be glad to answer your questions. 

[The prepared statement of Commissioner Hall, together with 

Press Release No. USDL–10–0886, appears in the Submissions for 

the Record on page 29.] 

Chair Maloney. Commissioner Hall, what are the bright spots 

in this month’s jobs report? And are there any particularly encouraging areas that you can report to us in this month’s report? 

Commissioner Hall. Well the biggest bright spot is of course I 

think the drop in the unemployment rate from 9.7 to 9.5 percent. 

And although the private sector job growth was not strong, it was 

8 

job growth; and it has been growing now for 6 straight months. So 

I think in context that is a positive sign. 

Manufacturing employment continues to grow—again, not 

strongly, but it has grown now for 6 straight months. So I think 

that also is a good sign. 

And temporary help continues to add jobs, and has added quite 

a few jobs. And that continues to be a good sign for generally future growth I think in employment. 

There was not really strong job growth—strong growth in any 

portion of the economy, but there was not strong job loss, either. 

And I think the several areas I mentioned were modest job growth. 

Chair Maloney. What sectors are experiencing more job creation than job losses now? You mentioned manufacturing. What 

other areas? 

Commissioner Hall. Manufacturing is. Retail trade declined a 

little bit this month, but over the prior six months it started to 

grow modestly in job growth. Of course temporary help services, I 

mentioned that as well. 

Education and health services continues to add jobs. And leisure 

and hospitality has grown jobs for the last six months, and in June 

as well. 

Chair Maloney. Are there any other sectors that are showing 

signs that they might have job growth, or giving an indication that 

they are getting stronger? 

Commissioner Hall. I would say there are no real industries 

that are losing jobs strongly. Everything is either hovering around 

little job growth or is growing a little bit. So I would say that the 

biggest indication is probably the temporary help services that has 

been strong, that suggests that at some point employers will start 

to bring back other workers. 

Chair Maloney. As you said, we are trending in the right direction. Are there any further indicators that overall job gains will 

continue in the coming months, besides the temporary help and the 

six months of job gains in manufacturing? 

Commissioner Hall. Yes. I think one of the more encouraging 

things, although this month the manufacturing work hours declined—that’s not a good sign; but prior to that, there had been a 

pretty steady rise in manufacturing work hours. That is generally 

a leading indicator, as well. 

Chair Maloney. And I would like to ask you about the Gulf region. Have you done any analysis on the impact of the disaster on 

jobs in that region? Are you tracking that? 

Commissioner Hall. We are starting to do some tabulations on 

that. We are probably not going to be able to simply identify 

which—you know, what has been the effect of the oil spill, but we 

will probably have some nice tabulations that will show you the 

areas that could be affected. 

In terms of the overall job impact, this is probably going to be 

a tricky thing to estimate because you do get a job boost from 

cleanup and activities like that, but then of course you have tourism and such along the beaches that will be impacted. But we do 

have some pretty good data on that, and I think as more of our 

data becomes available people will sort of be able to tease out some 

of the effect. 

9 

Chair Maloney. And when will it be available? 

Commissioner Hall. Some of it will be available over the next 

few months. The best data we’ve got actually will not be available 

for quite awhile. The payroll jobs that we sample right now, at 

some point we are going to do a census of all those. We do that 

once a year. That will give us really detailed information, but that 

will not be for another, probably another year. 

Chair Maloney. Thank you. 

Mr. Brady. 

Representative Brady. Commissioner, I can’t believe you just 

said a bright spot is that the unemployment rate fell. Do you realize that is because 652,000 Americans gave up looking for work? 

Commissioner Hall. Absolutely. The labor force did decline by 

that much. 

Representative Brady. So if next month another 600,000 people give up looking for work, should we organize some parade to 

cheer it? It seems to me that that is not good news going forward. 

And also, the second quarter I think all of us were kind of optimistic about it; it started out strong, and it has not moved forward. 

I do not see any payroll job growth by industry in this month’s 

report that is statistically significant. Do you? 

Commissioner Hall. No, I don’t. And I certainly would agree 

that we have not yet seen strong, sustained job growth. And that 

is clearly something we are going to need to see at some point to 

start lowering the unemployment rate further. 

Representative Brady. I think companies are hopeful, you 

know what I mean, that their customers or clients will start demanding, have that confidence, consumers will have confidence, 

companies will have confidence to make those investments and hiring decisions, but that is not happening. 

I do think it is the policies of Washington that is holding this recovery back. But I would like to point out, I agree that the unemployment benefits that have lapsed, that that is a tragedy, but I 

would point out that Democrats have no one to blame but themselves. This is not a surprise. We have known this deadline for 

months. 

They hold the super-majority in the House, the Senate, and they 

hold the White House. I guess, other than blaming George Bush, 

I think they have to look in the mirror for those who will not be 

getting help this month. 

But I think most people who are on unemployment are looking 

hard for work, you know, are struggling to find it, and what they 

really want are jobs. And this report today is not very encouraging 

news for them. 

One concern I have, and Chairwoman Maloney raised the issue, 

I think correctly, the impact of the Gulf oil spill. You know, clearly 

it is going to have an impact on tourism along those beaches. It is 

going to have a big impact on, you know, tourist season is pretty 

short. Shrimping, oyster season is very short. Every week counts, 

and matters. And I think we are going to see some real impacts 

from that going forward in the future months. 

Have you been able to estimate—another equally important blow 

to our economy is this drilling moratorium, six-month drilling moratorium on the 33 deep-water wells. The federal courts have stayed 

10 

that moratorium, but Secretary Salazar has announced in the next 

few days that they will find a way to reinstate it. 

In our region we are already—I had breakfast last week with a 

woman who was laid off due to the drilling moratorium. There are 

almost 50,000 jobs directly related to those rigs in the Gulf Coast 

in the deep-water area, and thousands of businesses, many of them 

small and mid-sized businesses who, as they say, we can’t survive 

six months without revenue. 

Have you had a chance to study the impact of shutting down our 

energy exploration in the Gulf for a six-month period, if that, including the rigs that will leave? It just was announced this week, 

rigs are leaving for West Africa and the Middle East and will not 

be returning for a year to three because of the schedule. Companies 

are already redeploying workers to other areas that are allowing 

energy exploration. 

Do you have any estimates yet on what the devastating economic 

impact of that moratorium would be? 

Commissioner Hall. We don’t yet, but we—if you like, I can follow that—— 

Representative Brady. Okay. 

Commissioner Hall [continuing]. And take a look and sort of 

see what sort of numbers—— 

Representative Brady. When do you think the impact from the 

Gulf spill will start showing up in your reports? I noticed in this 

week, for example, it was small, you know, but there was some tiny 

job gain in amusement, recreation, you know, that area, tourismrelated type areas. Do you think we will start seeing that impact 

in next month’s report, or the following one? 

Commissioner Hall [continuing]. Yes, whatever impact there is 

I think we will. The difficulty for us is teasing out the impact of 

something like that. Because in context of 130 million payroll jobs, 

teasing out that sort of impact is very difficult. 

I think we have got the right sort of data that someone can take 

a look at that and try to make some estimates, but to be honest 

it won’t be easy. And it’s not because it’s not there; it’s because it 

is very hard. 

Representative Brady. You have to isolate it to build it. 

Commissioner Hall. Yes. 

[Letter dated July 27, 2010 transmitting Commissioner Hall’s response to Representative Brady appears in the Submissions for the 

Record on page 33.] 

Representative Brady. Great. Thank you, Madam Chairman. 

Chair Maloney. Thank you very much. But I need to respond 

to my good friend and colleague. There’s a lot of revisionist history 

going on. 

Blaming the Democrats for the loss of jobs is absolutely factually 

incorrect. We see clearly in this chart in red, white, and blue for 

the 4th of July that’s coming up, clearly President Bush not only 

inherited a surplus, but we see throughout his Administration, in 

a zig-zagged way, we continued to lose jobs in a downward trend 

until the last month he was in office. We lost, this country lost, 

over 779,000 jobs. That is an undisputed fact. 

With President Obama and the Democratic policies, we have 

started to trend in the right direction. Now it is true that recovVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
11 

eries never move in a straight line. It has not been a straight line 

up that V-chart, and it certainly does not stand for victory, but it 

shows progress and that we are moving in the right direction. 

Now it shows that we have gained private sector jobs, the truest 

indicator of an economic recovery. The light blue is consistently zigzagged in a way, but it shows that we are stabilizing our economy. 

The recovery will take time, but we need to stay vigilant. We 

need to continue working. We need to continue helping our people 

find jobs. And I can assure you, the Democrats will not stop until 

every American who wants a job can get one. 

I now recognize my good friend and colleague, Mr. Cummings, 

who has been a very creative leader in creating jobs and helping 

small businesses. 

Representative Cummings. Thank you very much, Madam 

Chair. 

Mr. Brady said when Democrats look in the mirror we should 

blame ourselves for the plight of our many constituents who are 

out of work. And I just want to be very clear that when I look in 

the mirror I feel good about the fact that just yesterday I voted to 

try to help constituents get unemployment benefits, while the other 

side of the aisle was voting against those in need. 

So I do not know what kind of mirror we want to be looking into, 

but that is the mirror I look into. 

And I do not want to get into the blame game, but I do want to 

make the picture clear. Mr. Brady also asked you about the Gulf 

Coast. We understand that there are 33 wells—and I have been 

down there twice, and I am getting ready to go again—but there 

are 33 wells we are talking about here, out of 3,600, 33 wells that 

the moratorium affects. 

And when we see the damage that has been done to our environment, when we see the 11 gentlemen who were tragically killed, we 

had as a matter of fact one of them, his father was with us yesterday in the Transportation Committee. And then we see all the 

damage done to our environment, a six-month moratorium to try 

to get this thing straight so that it does not happen again seems 

to be a small price. 

So we do understand that it does affect people. And I have talked 

to folks on both sides of that issue. But the fact still remains that 

billions upon billions, tens of billions of dollars of damage has already been done. Lives have been lost. And we have got to figure 

out how to bring a balance to this, and I think the President is 

doing the right thing. 

But let me ask you this. Another thing Mr. Brady talked about— 

and I heard some people on CNBC talking about on my way here— 

they were saying that it was interesting that I think it was last 

month we had an increase in the number of jobs, but yet and still 

the rate—I’m not talking about this report, but the last one—but 

the rate stayed the same? Is that right? 

Commissioner Hall. Yes. 

Representative Cummings. It stayed the same. And they were 

saying that you have got a situation where if you are going to live 

and die by the rate—that is, either 9.5, 9.7, whatever—that there 

are certain variables that come with that. And, that—but the overall picture is still that we are going in the right direction. I mean, 

12 

in other words, that we are not moving backwards? Is that a fair 

statement? I am not trying to put words in your mouth. 

Commissioner Hall. No, that’s a fair statement. We are making—the data is showing improvement over several months. 

Mr. Cummings. And this temporary job thing, you talk about 

that every month. And you say that that is something significant. 

But at what point would you expect temporary jobs to turn into 

permanent jobs? Do you follow me? 

Commissioner Hall. Sure, sure. You know, it is not clear. It 

predicts turning points very well. And it is continuing to show 

growth. But to be honest, the reaction sort of varies at times. 

Sometimes it comes faster, sometimes later. 

Representative Cummings. And so these private temporary 

jobs, there was a small growth in those? 

Commissioner Hall. Yes, there was. 

Representative Cummings. And what is the significance of 

that, as opposed to public? 

Commissioner Hall. As opposed to public? With the private sector it’s a reflection of the fact, probably the fact that establishments 

are more likely to bring back the temporary help workers first before they start bringing back the permanent workers. That is why 

it winds up being sort of a leading indicator. 

And it is perhaps an indicator of some uncertainty, that they are 

bringing back temporary folks instead of permanent hires. 

Representative Cummings. But at least they are going in the 

direction of increasing something? 

Commissioner Hall. That’s correct. 

Representative Cummings. You know there was an article in 

The New York Times just yesterday that said that employment in 

the manufacturing sector is on the rise. And in fact it said the data 

would show an increase—the report today shows a report of 9,000 

jobs in manufacturing. Is that accurate? 

Commissioner Hall. That’s accurate, yes. 

Representative Cummings. And what is the significance of 

this data? 

Commissioner Hall. Well first of all, manufacturing has not 

shown sustained job growth for a long time. In fact, the last recession, the recovery after the last recession, manufacturing didn’t regain any of those jobs lost. 

So this is the first time manufacturing has shown some recovery 

from a recession in awhile, quite awhile. 

Representative Cummings. So I take it that is a good sign? 

Commissioner Hall. That is a good sign. 

Representative Cummings. I see my time has expired, Madam 

Chair. 

Chair Maloney. Thank you very much. 

Commissioner Hall, at our hearing in May we talked about Dr. 

Krueger’s testimony. He is an economist at the Treasury Department, and he had testified at an earlier Joint Economic Committee 

hearing that the recovery, of course, was fragile, and it was moving 

in the right direction but very zig-zaggy, but he did testify and said 

something that I thought was tremendously interesting. 

He said that in most recoveries the driver of new job creation has 

always historically been small- and medium-sized businesses, but 

13 

in this recovery it has been larger businesses. And I would like to 

ask you, do you have any numbers on small- and medium-sized 

companies and their hiring patterns? 

We in Congress have initiated a number of incentives to support 

small businesses to help them gain access to credit, to give them 

a tax relief for hiring new unemployed workers, and I would like 

to hear the status, since it is such an important part of our economy, of the employment movement in small- and medium-sized 

businesses. 

Commissioner Hall. First let me put it into context a little bit. 

In certainly the last recession, and in previous recessions, the job 

loss was somewhat centered in large firms. This particular recession it has been much more evenly balanced. There has been a 

much stronger job loss in small- and medium-sized firms than in 

past recessions. 

That has been notable. And now in this recovery, the early stage 

of the recovery hopefully, the large industries have shown—the 

large establishments have had job growth, since about September, 

but the medium and small have not. So they have been lagging in 

recovery. 

Our data isn’t real up-to-date on that yet. We should be getting 

out some new data pretty soon on that, but that is the early indication. 

Chair Maloney. Since small businesses are such an important 

engine of our economy and of our employment in our country, 

would it be possible for you to supply us on a more regular basis 

the information on employment in small- and medium-sized businesses? 

Commissioner Hall. Sure. Yes. That is a tabulation that we 

haven’t always done, but we can make an effort to try to update 

that for you. It is a little bit of a—it’s a little bit of a difficult thing 

for us because our sample size on that is not very large. That’s sort 

of why we don’t do it all the time, but certainly it does—it will help 

inform things, so we will see what we can do. 

Chair Maloney. Could you help put this recovery in context in 

the first six months of 2010? We now have six months of employment data, and I would like to see if you could put it in context. 

Setting aside the temporary Census jobs that we lost (you noted 

that 225,000 were lost), how would you characterize overall the job 

growth in the first six months of 2010? Not this month, but the 

trend in the past six months? 

Commissioner Hall. Right. The past six months we have averaged about around 100,000 jobs a month. And while that is not 

strong, sustained job growth, that is job growth. And I have to say, 

that has actually been fairly typical. 

The last two recessions, one of the things I have been struck by 

is, comparing to the last two recessions, the labor market, once it 

hit its trough, the first six months afterwards—in this Recession so 

far the trough looks like it was somewhere in November or December of last year. We have averaged growth of about 100,000 jobs 

per month in the private sector. 

Last recession we hit the trough in Total Private was July of 

2003. The first six months after that, we grew about 100,000 jobs 

a month. 

14 

Chair Maloney. So it’s basically the same? 

Commissioner Hall. It’s basically very much the same. And 

the—— 

Chair Maloney. And to the six months before that? 

Commissioner Hall [continuing]. The six months before that, 

the last half of last year we were losing about 175,000 jobs a month 

for the second half of 2009. 

Chair Maloney. So is this a labor market in freefall? Or would 

you characterize it as one consistent with the early stages of prior 

economic recoveries? 

Commissioner Hall. I would say this is consistent with the recoveries in the last two recessions. 

Chair Maloney. Do you see anything in this information that is 

a potential pitfall or problem we could see in the future? 

Commissioner Hall. No, just that we are in a point, as in past 

recessions, where we have got job growth, there is some job growth, 

but it is not strong job growth, and it is not sustained yet. 

So I would say the biggest risk is just we will have probably a 

higher risk than—until we start to get strong, sustained job 

growth—higher risk of things not improving quickly. 

Chair Maloney. Thank you very much. Mr. Brady. 

Representative Brady. This recovery certainly is not consistent 

with the recovery of 1981 and 1982, where job growth and unemployment were again three times better than the Obama recovery. 

I will, though, take comfort in telling our workers and small 

businesses in the Gulf Coast who will lose their jobs, are losing 

their jobs and losing their businesses due to the drilling moratorium, that they are, quote, ‘‘a small price to pay’’ for this over-reactionary and politically advantageous policymaking here in Washington. 

What is frustrating I think is that this Congress, Democrat Congress, has had control over MMS that oversees the Gulf for three 

years and done nothing to reform it. 

The Obama Administration themselves approved British Petroleum’s operational waivers on the wells. They approved the cleanup plans which have turned out to be awful. They have failed to 

support our Gulf Coast governors and local communities in protecting the marshes and beaches. That’s why you see them on TV 

every day pleading for help. 

And now with the drilling, trying to reinstate a drilling moratorium, they are intent on turning an environmental catastrophe into 

an economic catastrophe. I’m not just talking about 50,000 direct 

jobs that will be lost by the moratorium, or the $2 billion in wages 

that will be taken from the economy, I’m talking about thousands 

of small businesses, medium-sized businesses, simply won’t survive 

this. 

And what is frustrating is that 24 lawmakers on both sides of 

the aisle have sent a letter to Secretary Salazar recommending a 

path forward that would protect the safety and security of the Gulf 

but allow exploration to go forward on those development and appraisal wells in the Gulf, three-fourths of them in the Gulf that 

pose almost no risk at all, a proposal that would save 75 percent 

of the jobs, avoid an energy supply problem in 2011–2012; we’re 

just hopeful that maybe the small people, the small price to pay 

15 

folks who are going to suffer can get some relief under this White 

House. 

Maybe Congress could delay their unemployment checks, as well. 

Commissioner, jobs’ claims were up again last week. Construction has stalled out. No industry, as you just said a moment ago, 

none of the job growth here is statistically significant at all. 

Now there are worries from Europe. There are concerns about 

manufacturing slowdowns in China and throughout the world. The 

debt is keeping consumers at bay. The saving rate, if I understand, 

continues to go up. People are banking their money rather than 

buying from it. 

I too am looking for optimistic signs in these numbers, and the 

sooner we get this recovery going the better. But I just do not see 

what I think we are all hoping for. We need at least 200,000– 

250,000 private sector, not government workers but private sector 

workers each month, that job gain just to start working off the unemployment rate in a sustainable rate? Is that the rough estimate? 

Commissioner Hall. Yes, I would say that would be strong sustained growth. 

Representative Brady. So lowering the unemployment rate not 

by workers giving up, which is what happened again this month, 

but by workers going back to work, we need at least twice the job 

growth rate in the private sector than we got this month? Is that 

correct? 

Commissioner Hall. To make a strong move downward in the 

unemployment rate, we do need something stronger. 

Representative Brady. I think that’s what we ought to be 

shooting for in all our policies up here, is, you know, adding at 

least 200,000–250,000 private sector, not government jobs, to the 

payroll so that we can get this unemployment down and people can 

get some hope back again; consumer confidence can rise; and companies will again, you know, not be so fearful of Washington, energy prices, new taxes, new regulation, all this debt, that they’ll 

make those critical business investment decisions. 

Thank you, Commissioner. 

Chair Maloney. Okay. Mr. Cummings. 

Representative Cummings. Yes, Thank you very much, 

Madam Chair. 

The Chairwoman was asking you, Commissioner Hall, a few minutes ago about I think medium-sized and small businesses. Do you 

remember that? 

Commissioner Hall. Yes, I do. 

Representative Cummings. In my District we just had the 

Federal Reserve to come and talk to some small business folks, 

about two or three weeks ago, because the Federal Reserve was 

trying to get a feel for what problems they were experiencing. 

And what we heard over and over again from these small business people was they had a problem with access to capital. They 

said that they had a lot of opportunities, a lot of opportunities to 

do certain jobs, but then the banks were not lending and they could 

not get access to capital. 

And I was just wondering. When you go through your—when you 

make these—the Chairwoman was asking about certain information is not in your reports and was asking you to look at some 

16 

things. You don’t go into depth as to why certain things happen 

like that, do you? 

In other words, you don’t go that far? 

Commissioner Hall. No, we don’t. 

Representative Cummings. And you do not even draw conclusions, do you? 

Commissioner Hall. No. 

Representative Cummings. I see. But that certainly is very, 

very significant—if you do not have the money, it is kind of hard 

to do what you have to do. And we have been pushing pretty hard 

on this side of the aisle trying to get these banks to do even more 

to open up the door so that people can get the capital. 

One of the things that is interesting, too, as I listen to you, I 

could not help but think about years ago when I was learning to 

ride a bike. Remember, the chain had to catch? But if the chain did 

not catch, you were not going anywhere fast. 

And basically what it sounds like here is things moving in the 

right direction, but there needs to be some kind of little catch, a 

push to get us moving, moving even faster. But once that happens, 

it seems, just listening to what you’re saying and having read the 

information provided today, we might see that motion that sends 

us into another level of progress. 

In the past, has that been the case? In other words, in talking 

to the Chairwoman you were talking about how this compared to 

2003, I think it was, and you said six months you see about 

100,000 jobs each month. So what have you seen in the past with 

regard to when you get beyond that six months? And is there anything different about this Recessionary situation which would 

cause you to have less optimism or more pessimism? 

Commissioner Hall. It is true that in the past, through the 

past couple of recessions, after the six-month time period there was 

at some point fairly soon where the job growth did strengthen and 

become sustained. And we got well on our way to sort of recovering 

all of the jobs lost during the recession. 

The biggest concern that I would have going forward is that this 

has been a very severe Recession. And we do need—ideally, we 

would have even stronger job growth than in the last couple of recessions to recover those jobs. Otherwise, it is going to take awhile 

to recover those jobs. That would be my biggest concern, is that we 

really do need even stronger job growth than we have had during 

the early parts of the last couple of expansions to get back the jobs. 

Representative Cummings. And those other recessions, were 

they associated with anything like the problems that we have had 

with regard to Wall Street? 

Commissioner Hall. No. No, in fact both those other two recessions were mild recessions and relatively short recessions. This has 

been neither mild or short. 

Representative Cummings. So, I’m not putting words in your 

mouth, I am going to repeat what I said. President Obama came 

into this situation having to put a patient in intensive care, not 

just in critical—not just critical care, but intensive care, and now 

it has taken awhile to get out of that. It is a slow process. 

All of us would like the patient to get better quicker, but the fact 

still remains that—and for every person out there, and believe me, 

17 

I feel their pain. Because I see them every day. When I got back 

to my District today, I guarantee you there will be people that will 

come up to me and say: Cummings, I’m looking for a job. 

But the fact is that we are going in the right direction. I just 

want to make it even faster. 

Thank you very much, Mr. Hall. 

Chair Maloney. Thank you very much. 

I agree with my good friend and colleague, Mr. Brady, that what 

we want in this country is robust private sector job creation. But 

I believe that trying to create 250,000 private sector jobs a month 

is a very daunting job, given the fact that the former President, 

President Bush, created roughly that much during his entire eight 

years in office. 

Again, for the 4th of July, our chart is in red, white, and blue. 

We were losing over 779,000 jobs a month. It takes a long time to 

recover, but we are trending in the right direction, employing 

Americans and digging ourselves out of this deep valley that President Obama inherited. 

I would like to ask you, Commissioner Hall, a few questions on 

some reports that the JEC produced on certain demographics and 

the impact of this Recession on them. 

In a report we did in March we found that African Americans 

had been disproportionately hurt by long-term unemployment. 

Have you seen any recent signs that the duration of unemployment 

is shortening for African Americans? 

Commissioner Hall. No, I haven’t. 

Chair Maloney. You have not? 

Commissioner Hall. No. 

Chair Maloney. And also in a May report that we issued on 

working mothers, we noted that one out of three working mothers 

was the sole bread winner for her family. You noted in your last 

employment hearing that it is women with children who lost their 

jobs during this Recession. I am concerned how they are faring. 

Women and working mothers in particular—how did they fare during June? 

Commissioner Hall. Yes. You know, I don’t have that data real 

handy. Yes, I think we don’t have that data yet, but I would be 

happy to follow up with you for the June numbers. That data sort 

of lags. 

Chair Maloney. Okay. Thank you. 

[Letter dated July 16, 2010 transmitting Commissioner Hall’s response to Representative Maloney appears in the Submissions for 

the Record on page 34.] 

Chair Maloney. And in a May report that the Joint Economic 

Committee issued on younger workers, we found that these workers were experiencing the highest unemployment in history for 

younger workers. Did things get any better in these June numbers 

for younger workers? 

Commissioner Hall. Not significantly, no. 

Chair Maloney. They did not. We also released a report on the 

impact of the Recession on Hispanic workers, and the report concluded that the drivers of unemployment in the Hispanic community are industry and geography. Latino workers were over-represented among construction employment, and going into the downVerDate Nov 24 2008 14:47 Oct 20, 2010 Jkt 058196 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 C:\DOCS\58196.TXT SHAUN PsN: DPROCT
18 

turn were more likely to live in regions that were hit hard by the 

housing burst—the housing bubble states such as Nevada, Arizona, 

Florida, and California. What has happened to construction employment in the first half of 2010? Is it experiencing job gains at 

the same rate as some of the other sectors? 

Commissioner Hall. No. In fact, we have been losing about 

19,000 jobs a month for the first half of this year in construction, 

still. 

Chair Maloney. Do you see any evidence that construction employment will expand in the near future and eventually reach the 

levels seen before the housing market collapse? 

Commissioner Hall. No. I think obviously the thing you would 

want to see first is the pickup in new-home construction, new housing starts. And we have not yet seen a big pick up in that. 

Historically it takes awhile, once the housing starts start to pick 

up, for the employment level to pick up. So there are not good signs 

on that yet. 

Chair Maloney. And with the Latino community, we felt that 

we need to look at focusing on policies on providing these workers 

not only with skills but the ability to be mobile, to move to areas 

where the economy is better, particularly in the construction 

trades. So we have been looking at trying to improve that, and 

working in that area. 

My time has expired. My colleague, Mr. Brady. 

Representative Brady. Man I hate being outnumbered on this 

Committee. It makes for a tough Friday morning. [Laughter.] 

Well I do think President Bush should apologize for the United 

States losing its soccer game the other day; Chicago not winning 

the Olympics bid; Avatar not winning the best motion picture of 

the year; and Democrats not passing unemployment benefits, for 

those who are out of work. 

Let’s talk about debt, because it has a real impact on our economy. The debt of course is just skyrocketing. At one point, $5 trillion last year, $1.4 trillion this year. And the Congressional Budget 

Office tells a terrifying tale here in their report, in America’s Debt. 

We have had economists before us telling us that when debt 

reaches a certain level, publicly held debt reaches a certain level, 

it creates a very strong drag on the economy, usually around the 

90 percent level. 

We are at 83 percent of the GDP for all debt; 62 percent in the 

publicly held debt. It will skyrocket over the next decade in debt. 

And that puts us already right now, we are below Greece, Italy, 

and Portugal, but above other European countries that are Ireland, 

Spain, that are in trouble. 

In gross debt, in budget deficit we trail only Greece and Ireland. 

We are almost at 10 percent, the budget deficit, of percentage of 

our economy as well. This debt will increase as far as the eye can 

see. And the only thing being considered at this point are increasing taxes on families, small businesses, capital, dividends, and on 

companies that are trying to sell around the globe. 

Commissioner, debt creates higher interest payments for a budget, puts a strain on companies borrowing as well, and tends again 

to drag down the economy. At what point, or can you estimate how 

19 

much our economy is hurting as a result of the debt that we are 

accumulating? And long term what that would do to our economy? 

Commissioner Hall. I wouldn’t. That’s just—I guess the main 

reason, that’s not my garden to hoe. I am focused on the labor market. 

Representative Brady. You are a wise man. [Laughter.] 

Representative Brady. Can we talk a little about where you 

see trends going? Construction has stalled out for several months 

now. Manufacturing, as you said, has been stalled out as well. The 

few jobs we did see seem to be in services, temporary services, 

some services in consulting, a small amount in recreation and tourism. 

Are there any significant trends within the numbers this month 

that we can be looking to? 

Commissioner Hall. I don’t want to speculate too much about 

going forward, but I think most of the trends that we have already 

seen have been the ones that I have mentioned, that we have had 

some job growth in manufacturing, and temporary help services 

continues to add jobs, and education and health services. Those 

have been the real trends pretty much all this year. 

Representative Brady. Great. Thank you, Madam Chairman. 

Chair Maloney. Thank you, my good friend and colleague. You 

mentioned the deficit, and that is a concern that we have. The Federal budget deficit was $941 billion through the first eight months 

of the fiscal year 2010, and $51 billion less than the record shortfall recorded over the same period last year. So both revenues and 

outlays are down. 

The debt is now—you know, we do have a strong debt. The total 

debt for the Federal Government was $13 trillion, and the Federal 

Government paid roughly $152 billion in interest through the first 

eight months of 2010, or 1 percent of GDP. 

We are certainly not in comparison with Greece. Certainly we 

need to focus on it, but to compare our economy at this point with 

others is really factually inaccurate. 

Now Mr. Cummings is recognized for five minutes. 

Representative Cummings. Mr. Hall, you spoke about the 

health care industry. You said they had increased jobs? 

Commissioner Hall. Yes. 

Representative Cummings. Has that been a steady situation? 

One of the things that I have been trying to encourage many of my 

constituents to do is to look towards those fields that seem to be 

on the upward trend, and seem to be providing jobs in a steady 

way. Because the reports are that a lot of companies now are doing 

more with less, and therefore will not be replacing people in the 

same jobs. 

So people have to be retrained. So I am just wondering if there 

are areas—for people that are looking at this right now—if there 

are areas that you see a trend in with regard to jobs either increasing or not losing, but seeming to have a steady, you know, some 

kind of stability or growth, what would those areas be? 

Commissioner Hall. Well the one that jumps out the most is 

in fact health care. Health care has steadily added jobs throughout 

the whole Recession. That is a fairly remarkable thing when you 

20 

consider how many jobs we were losing while they were still growing some jobs. 

And certainly going forward, the demographics of the American 

population are going to encourage, probably going to encourage job 

growth in the health care industry as well. 

Representative Cummings. And when you look at the health 

care industry, is there a breakdown? Is it just general health care? 

Is it various types of health care? I’m just curious. Is it just health 

care in general? 

Commissioner Hall. We’ve got some breakdowns into some various categories. 

Representative Cummings. Okay, can you give me an idea of 

just generally what some of them might be? 

Commissioner Hall. Sure. 

Representative Cummings. In other words, I want people who 

are watching this to get an idea of what might be—I have got some 

people who have been out of a job for a long time, and they are 

trying to figure out where they go from here, and possibly going to 

a community college, or going back for some type of training, and 

I just want to give them some sense of hope. I have heard a lot 

of fear from Mr. Brady this morning, but I want to give some hope. 

Commissioner Hall. Sure. Within health care we have got ambulatory health care services, which includes: offices of physicians, 

outpatient care centers, home health care services. That sector 

added about 7,400 jobs this month. That was the major part of the 

job growth in health care this month. 

Hospitals actually have been losing jobs the last, this past 

month, the last 2 months. But there’s also nursing and residential 

care facilities, which the biggest part is nursing care facilities. 

Those have been adding jobs throughout the Recession. 

And then—well social assistance is often worked into health care, 

as well, and that has continued to add jobs, child day care services 

and such. 

Representative Cummings. Now are there any other areas 

other than health care that might fall into that category of staying 

steady or increasing jobs? 

Commissioner Hall. Sure. You know, I think one of the 

things—I don’t have the numbers in my mind very clearly, but we 

do produce some long-term forecasts on occupations and industry 

growth. And we have just released some last year that really give 

you an idea in great detail about the sort of industries where we 

expect job growth through either replacement or through just growing industries. 

There are a number of areas, mostly services’ industries, serviceproviding industries, that have quite a bit of promise. 

Representative Cummings. The tourism industry and restaurants, or whatever, how are they doing? 

Commissioner Hall. They are doing okay. They have actually 

gone up and down. Those haven’t shown a real clear pattern. We 

did have a loss this month in retail. 

Representative Cummings. The reason why I mentioned tourism and things of that nature is because it might show some confidence on the part of consumers if they are doing things that they 

21 

might otherwise, if they were so concerned about finances, that 

they probably would not do. And I was just trying to figure out—— 

Commissioner Hall. Sure. That makes logical sense, and I have 

sort of looked at that and I have not seen a real clear pattern, to 

be honest. 

Representative Cummings [continuing]. I see. 

Commissioner Hall. It does not seem to reflect so well consumer confidence like you think it might, like I thought it would. 

Representative Cummings. So last question. If the President 

called you as soon as we finished here and said: Hall, what is your 

summary of this month’s report? What would you say? 

Commissioner Hall. I would say this is not a strong report, but 

the prior six months have been encouraging. This is not a strong 

report, but we did have a drop in the unemployment rate. We did 

have some job growth. And the past six months have had some job 

growth. 

Representative Cummings. Thank you very much. 

Chair Maloney. Thank you very much, Commissioner Hall, and 

your staff for being here today. And I thank my colleagues. 

The last six months, as Commissioner Hall has pointed out, the 

data clearly shows that the labor market has begun to turn around 

and is trending in the right direction. 

Without a doubt, job creation will be at the top of our to-do list, 

and it will remain there until Americans across America are back 

to work. So I would like to wish everyone a safe and happy Independence Day, and thank you very much. 

[Whereupon, at 10:46 a.m., Friday, July 2, 2010, the meeting of 

the Joint Economic Committee was adjourned.] 

(23) 

SUBMISSIONS FOR THE RECORD 

24 

PREPARED STATEMENT OF CAROLYN MALONEY, CHAIR, JOINT ECONOMIC COMMITTEE

Today’s Employment Report from the Bureau of Labor Statistics shows that in 

June, the economy added 83,000 private sector jobs, the sixth straight month of employment gains in the private sector. 

Since the beginning of the year, the economy has added 593,000 jobs in the private sector. 

As expected, the June report also showed a sharp decline in temporary Census 

workers causing total nonfarm payrolls to decline for the first time this year. 

Additionally, the June employment report showed that the unemployment rate 

ticked down to 9.5 percent and the number of unemployed workers declined by 

350,000. 

Although the overall unemployment rate has declined from its peak of 10.1 percent in October, not all demographic groups are seeing the same trends in unemployment rates. 

For example, the unemployment rate for African American workers continued to 

rise after October, although the current unemployment rate of 15.4 percent is lower 

than the peak of 16.5 percent. 

Although the unemployment rate for women showed little change in the first 5 

months of 2010, the unemployment rate for women declined in June to 8.3 percent. 

We have made real progress in the past year. Last June, we lost 452,000 private 

sector jobs. While these job gains are not as robust as earlier this year, the trend 

is in the right direction. 

The policies that Democrats in Congress quickly put into place over the last year 

are working. 

In addition to overall private sector job gains, 

• Manufacturing employment has risen for six months in a row, after falling 3 

straight years. 

• Consumer spending has risen every month since October 2009. 

• Surveys of both the service sector and the manufacturing sector show that 

growth expected to continue. 

But we have to be patient. The path to recovery is never a straight line. For the 

millions of workers who lost their jobs, it will take time for them to become employed again. 

We also have to be vigilant. The recovery is still fragile and our economy is still 

vulnerable. 

In fact, Nobel laureate Paul Krugman believes that we are in the early stages of 

another Great Depression. 

He recently wrote that this depression ‘‘will be primarily a failure of policy . . . 

governments are obsessing about inflation when the real threat is deflation, preaching the need for belt-tightening when the real problem is inadequate spending.’’ 

I am disheartened that the Senate has failed to extend unemployment insurance 

benefits, despite the fact that there are still 14.6 million unemployed workers bearing the brunt of the worst economic crisis since the Great Depression. 

As a result, an estimated 1.7 million unemployed workers will lose benefits by the 

end of next week. 

Some Members of Congress do not want to extend unemployment benefits because 

they believe these benefits create a disincentive for people to seek work. 

As this JEC majority staff report shows, the evidence is clear—these benefits do 

not inhibit job seekers from vigorously looking for or accepting work. 

Instead, these benefits provide an enormous benefit to society, by stimulating the 

economy as well as preventing workers from dropping out of the labor force. 

Even former Fed Chairman Alan Greenspan expressed strong support for extensions of unemployment benefits after the first Bush recession. 

In a hearing before the JEC in May 2003, Chairman Greenspan stated, ‘‘When 

you’re in a period of job weakness where it is not a choice on the part of people 

whether or not they’re employed or unemployed, then, obviously, you want to be 

temporarily generous. And that’s what we’ve done in the past, and I think it’s 

worked well.’’ 

In May 2003, we had fewer than 3 unemployed workers for every opening and 

the unemployment rate was 6.1 percent. 

The most recent data shows that there are 5 unemployed workers for every opening and the unemployment rate is 9.5 percent. 

Extending these benefits provides more than needed stimulus to the economy and 

a social safety net for people who are out of work. 

It is fiscally prudent as well. 

25 

Disabled workers who become discouraged and drop out of the labor force enter 

the Social Security Disability Insurance program, which is much more expensive 

than unemployment insurance benefits. 

We also know that unemployment benefits stimulate the economy. Every dollar 

in unemployment benefits multiplies to create over $1.60 in economic activity. 

At a hearing before this committee in February, Douglas Elmendorf, Director of 

the nonpartisan Congressional Budget Office, testified that extending these benefits 

is one of the most effective and efficient ways to stimulate the economy. 

And surely it is obvious that getting the economy to grow and getting people back 

to work are crucial to getting our deficit under control. 

Moreover, this will be the first time since 1959 that the government will allow 

unemployment benefits to expire when the national unemployment rate was above 

7 percent. 

It is time for all Members of Congress to put the American people first. 

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PREPARED STATEMENT OF REPRESENTATIVE KEVIN BRADY

I am pleased once again to join in welcoming Dr. Hall before the Committee this 

morning. 

Today’s report is bad news for American workers and their families. Total nonfarm payroll employment decreased by 125,000. Even after excluding the layoffs of 

225,000 temporary Census workers, private sector payroll job growth remains anemic at 83,000. At this slow pace it will take much of the decade to return to normal 

employment levels. 

While the unemployment rate fell to 9.5 percent, it fell for the wrong reason, a 

precipitous drop of 652,000 in the labor force. The number of discouraged and other 

marginally attached workers that have stopped actively seeking jobs rose to 2.6 million, an all-time series high. And 6.8 million American workers have remained unemployed for six months or longer. 

In January 2009, President Obama promised that the Democrats’ economic program would restore confidence and jump-start the U.S. economy. Last month, the 

Conference Board’s Consumer Confidence Index fell dramatically by 9.8 percentage 

points to 52.9. Consumer confidence is flagging because families are frightened by 

dangerous deficits as far as the eye can see. 

As for jump-starting the economy, two of the Administration’s top economists, 

Christina Romer and Jared Bernstein, predicted that if Congress were to pass the 

President’s stimulus bill then (1) the unemployment rate would remain below 8.0 

percent, and (2) non-farm payroll employment would increase to 137.6 million by the 

fourth quarter of 2010. Democrats in Congress enacted the American Recovery and 

Reinvestment Act on February 17, 2009, but this stimulus has fallen far short of 

these predictions. 

The growth of real GDP slowed by more than one-half from 5.6 percent in the 

fourth quarter of 2009 to 2.7 percent in the first quarter of 2010. A number of economic indicators flashed yellow in the second quarter of 2010, suggesting that economic growth may be sluggish for the remainder of this year and 2011. Americans 

don’t see an economy in recovery, they see a White House seemingly incapable of 

protecting our beaches or getting people back to work. 

This anemic economic performance after the recession that began in December 

2007 is in sharp contrast to the robust economic growth that benefited American 

workers and their families after the 1981–1982 recession. During the first three 

quarters of recovery, the real GDP growth rate averaged 7.5 percent under Reagan 

compared with 3.5 percent under Obama. Eleven months into the recovery under 

Reagan, payroll employment increased by 2.8 million, and the unemployment rate 

fell by 2.3 percentage points. In contrast, twelve months into the Obama recovery, 

payroll employment has fallen by 195,000. 

President Reagan’s economic policies were a tailwind accelerating real GDP 

growth. President Reagan pursued pro-growth policies including large reductions in 

marginal tax rates, deregulation, and trade liberalization. Combined with the disinflationary monetary policies under Federal Reserve Chairmen Paul Volcker and 

Alan Greenspan, Reagan laid the foundation for two decades of prosperity. 

In contrast, President Obama and Congressional Democrats have pursued largely 

anti-growth policies that have hindered this recovery. Businesses are slow to hire 

because they fear higher taxes, job killing regulation and a dysfunctional Washington that is ideologically driven and increasingly anti-business. Instead of providing encouragement, President Obama and this Congress have given entrepreneurs reason to worry. 

Ominously, President Obama and Congressional Democrats are insisting on reckless increases in federal spending both now and in the future. This puts the tripleA reputation of the U.S. government into jeopardy for the first time since Secretary 

of the Treasury Alexander Hamilton miraculously resurrected the finances of the 

United States after the Revolutionary War and put us on the road to becoming the 

world’s economic superpower. 

The Congressional Budget Office projects that under the President’s budget, federal spending will grow to 25.2 percent of GDP, well above its post-war average of 

19.5 percent of GDP. A structural budget deficit in excess of 4 percent of GDP will 

persist through the next decade. Consequently, publicly held federal debt will rise 

to 90.0 percent of GDP by the end of fiscal year 2020. In The Long-Term Budget 

Outlook released two days ago, the Congressional Budget Office projects that under 

the alternative fiscal scenario, which keeps current policies in place, uncontrolled 

spending growth will cause the publicly held federal debt to explode to 947 percent 

of GDP by the end of fiscal year 2084. 

President Obama and Congressional Democrats are pursuing reckless fiscal policies that are clearly unsustainable. Unless their excessive spending, deficits, and 

28 

debt accumulation are quickly reversed, the United States may experience a debt 

crisis similar to Greece. We are putting the future of our children and grandchildren 

in grave jeopardy. Unlike Greece, however, no one will be around to bail us out. 

Dr. Hall, I look forward to hearing your testimony. 

PREPARED STATEMENT OF REPRESENTATIVE ELIJAH E. CUMMINGS

Thank you, Madam Chair. 

Commissioner Hall, I appreciate you and your team from the Bureau of Labor 

Statistics for being here today. 

Last week, Chairwoman Maloney and I spent a great deal of time in this room 

as conferees to the Dodd-Frank Regulatory Bill. 

In addition to ensuring that Federal Regulators have the necessary tools for restructuring ‘‘too big to fail’’ financial organizations before irresponsible behavior 

could again threaten our entire economy, we looked out for the people on Main 

Street by providing support to those facing foreclosure through no fault of their own. 

During the last 15 months, I have sponsored four foreclosure prevention seminars, 

and thousands of distressed homeowners have attended. Black, White, and Hispanic 

Americans—they all were in tears. 

We can and must do better than this. 

This is why I am extremely gratified that the conference committee accepted my 

proposal for the creation of a $1 billion fund—that would provide low-interest 

‘‘bridge loans’’ to homeowners facing foreclosure. 

Let me repeat myself. This is a loan, not free money. 

I am also pleased that the House passed legislation to extend unemployment benefits to over 1 million people yesterday. 

It is my hope that the Senate will take up this matter after the District Work 

Period. 

We took care of the people on Wall Street but it is our duty to assist those who 

have fallen victim to circumstances beyond their control. 

* * * 

Now there are some who will argue that Congress should be focused more on job 

creation—well we have been and it is priority number one. 

Excluding the economic stimulus bill, Congress has enacted and President Obama 

signed into law, the Hiring Incentives to Restore Employment (HIRE) Act that provides a new payroll tax exemption that will lead to the creation of over 300,000 jobs. 

Additionally, the House has passed 6 major job creation bills that would create 

over 600,000 jobs when enacted. 

Chief among them is H.R. 5019, HOME Star Energy Retrofit Act that would provide immediate incentives for consumers to renovate their homes to become more 

energy-efficient, while saving families money. 

Of equal importance is the fact that HOME Star would create over 160,000 jobs 

in construction, manufacturing and retail industries that have been devastated by 

the economic crisis. 

It is my hope that the Senate will move quickly in considering all of these bills. 

* * * 

This morning, we learned that the private sector added 83,000 jobs during the 

month of June. 

Like many, I had hoped to see greater gains. However, these additional jobs are 

not to be taken for granted. I know that each of these families is incredibly appreciative. 

All of us should remember that prior to President Obama taking office, our constituents faced job losses of nearly 800,000 a month. 

Whereas, under Democratic leadership—jobs have been created in 6 of the last 7 

months—this is over 1 million jobs. 

* * * 

However, while traveling through by hometown of Baltimore and other parts of 

my district, I am keenly aware that many more people need jobs. 

In fact, Wednesday’s Washington Post discussed a survey conducted by the Pew 

Research Center in which nearly half of the survey’s respondents say they are 

in worse financial shape as a result of the downturn, which destroyed 20 

percent of Americans’ wealth. 

So, I understand and agree that more needs to be done in order to get middle 

and working class families back to work. 

However, the need and importance of interim assistance like the short-term 

bridge loans and unemployment benefits should not be discounted. 

29 

Madam Chair, I look forward to Dr. Hall’s testimony and with that, I yield back. 

PREPARED STATEMENT OF KEITH HALL, COMMISSIONER, BUREAU OF LABOR

STATISTICS

Madam Chair and Members of the Committee: 

Thank you for the opportunity to discuss the employment and unemployment data 

we released this morning. 

Nonfarm payroll employment fell by 125,000 in June, and the unemployment rate 

edged down to 9.5 percent. The decline in employment reflects a large drop in the 

number of temporary workers for Census 2010. The number of jobs in the private 

sector edged up (+83,000), due to modest increases in several industries. Private sector employment has risen by 593,000 so far in 2010, but in June was 7.9 million 

below its prerecession level. 

Over the month, federal government employment declined sharply. The number 

of temporary Census 2010 workers dropped by 225,000, leaving 339,000 temporary 

workers on the Census payroll. 

In the private sector, temporary help services employment continued to grow over 

the month (+21,000). The industry has added 379,000 jobs since September 2009. 

Employment also rose in management and technical consulting (+11,000) and in 

business support services (+7,000) in June. Amusements, gambling, and recreation 

gained 28,000 jobs, while transportation and warehousing employment was up by 

15,000. 

Mining employment continued to trend up (+6,000), and the industry has gained 

56,000 jobs since October 2009. Employment in manufacturing also continued to 

trend up in June (+9,000). The industry has added 136,000 jobs so far this year. 

The manufacturing workweek declined by half an hour in June, more than offsetting 

an increase in May. Nonetheless, factory hours remained 1.3 hours above their recent trough. Employment in health care edged up in June (+9,000). 

Construction employment fell by 22,000; specialty trade contractors accounted for 

most of the decline. On net, construction employment has shown little change over 

the last 4 months. 

Average hourly earnings of all employees on private nonfarm payrolls decreased 

by 2 cents in June to $22.53. Over the past 12 months, average hourly earnings 

have increased by 1.7 percent. From May 2009 to May 2010, the Consumer Price 

Index for All Urban Consumers (CPI-U) rose by 2.0 percent. 

Turning to measures from the survey of households, the unemployment rate edged 

down by 0.2 percentage point to 9.5 percent in June. Of the 14.6 million unemployed 

individuals, about 6.8 million had been jobless for 27 weeks or more. In comparison, 

1.3 million persons were unemployed for 27 weeks or longer when the recession 

began. 

The labor force declined in June (¥652,000). Following increases earlier in the 

year, the labor force participation rate has declined by half a percentage point over 

the last 2 months. 

The employment-population ratio edged down to 58.5 percent in June. Among the 

employed, there were 8.6 million individuals working part-time who preferred fulltime work. The number of such workers has fallen by 525,000 over the past 2 

months. 

In summary, payroll employment fell by 125,000 in June, as modest growth in the 

private sector (+83,000) was more than offset by a large decline in temporary census 

workers (¥225,000). The unemployment rate edged down to 9.5 percent. 

My colleagues and I now would be glad to answer your questions. 

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