As the unemployment rate continues to hover at undesirable levels, analysts are of the opinion that this will play an important role in determining the fate of upcoming elections. The current recorded unemployment rate of 9.7% is appalling, even if the recent recession is taken into account.
Post recession, analysts are still trying to understand why the unemployment levels dropped to these dismal depths even though the predictions made earlier showed slightly better prospects for the jobs market during the worst of the recession.
About 8.4 million jobs were lost during the recession which was the worst since the Great Depression. Most experts had not expected the outcome to be this bad. Post facto, some analysts say that the recession was much worse than generally believed and affected many more layers of the economy than was evident. This is the reason for the huge impact on employment and is also responsible for the continued slowdown in employment recovery. The employment levels are yet to pick up even though the government is putting all its muscle behind the cause.
Considering that unemployment reflects the general state of affluence of a country’s populace, these rates will affect the outcome of the elections which are looming ahead. President Obama’s healthcare reforms may not really make a material difference in boosting his party’s chances to a win, some experts have predicted. However, even a marginal alleviation of the nearly 10% unemployment rate is very likely to tip the scales in his favor.
Meanwhile the March employment report is drawing a lot of attention from the general public and policymakers alike. But the Federal Reserve Chairman Ben Bernanke has cautioned that these readings will have to tempered with the knowledge to include the census figures too. Several thousand people have been employed temporarily for the census work which will reflect in the employment report. But the work lasts only a few months after which these persons will go back to the ranks of unemployed unless they have a job in hand to go to subsequently. Given this, Bernanke has made his views clear that he does not expect any significant improvement in the employment opportunities in this year.
While the Democrats are still hopeful of improvement in this sector by April, and are looking at riding on health care reforms to stay in power, the fact remains that the economy is still the single most critical factor in the minds of the electorate. In a recent CBS/New York Times poll, more than half of those surveyed said that the condition of the economy would determine their loyalty to either party.
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