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Business

September 7, 2012

Jobless rate dips -- but only because more gave up looking for work

(Continued)

— Christopher S. Rugaber, AP Economics Writer

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NOT SO FAST

Will the Federal Reserve go big next week?

Some economists expect a new bond-buying program to be announced.

Others aren't so sure. Most do think the Fed will unveil something, after Chairman Ben Bernanke said last week that the Fed will do more to help the economy.

But they don't see a bold move. Not yet, anyway.

Sal Guatieri of BMO Capital Markets thinks the most likely Fed step will be to extend its timetable for keeping short-term rates at record lows. Currently, the Fed plans to keep rates there until at least late 2014. Guatieri said he thinks that target will be extended to mid-2015.

But by late December or early next year, Guatieri says the Fed could begin more bond buying, perhaps focused on lowering mortgage rates.

— Martin Crutsinger, AP Economics Writer

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GOVERNMENTS HURTING, NOT HELPING

In normal recoveries, government hiring helps economies recover from recessions.

Not this time.

When you count the 7,000 public-sector jobs lost in August, governments at all levels — federal, state and local — have slashed 670,000 jobs since the recession ended in June 2009. By contrast, private companies have added 3.5 million jobs.

It's the first time since World War II that governments have shed jobs this deep into an economic recovery. At this point — three years and two months — into the nine previous postwar recoveries, government jobs had risen an average 8 percent.

This time, they're down 3 percent.

— Paul Wiseman, AP Economics Writer

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OBAMA'S BREAK-EVEN MILESTONE

Here's a milestone that's difficult for President Barack Obama to brag about: There are 133.3 million Americans working — 261,000 short of the number when he was inaugurated in January 2009.

At this year's pace of job creation, payrolls would return to that level in October. And the job totals would be released Nov. 2 — four days before the election.

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