UNEMPLOYMENT RATE DECLINES - AT 9:10 A.M. ET:  In a stunning development, and very good news for the White House, the unemployment rate has declined, according to figures just released.  It had been expected to rise.  The change is, again, a cautionary note for those who believe that Obama is on an inevitable road downward.

WASHINGTON (Reuters) - U.S. employers cut 247,000 jobs in July, far less than expected and the least in any month since last August, according to a government report on Friday that provided the clearest evidence yet that the economy was turning around.

With fewer workers being laid off, the unemployment rate eased to 9.4 percent in July from 9.5 percent the prior month, the Labor Department said, the first time the jobless rate had fallen since April 2008.

The government revised job losses for May and June to show 43,000 fewer jobs lost than previously reported.

Analysts had expected non-farm payrolls to drop 320,000 in July and the unemployment rate to rise to 9.6 percent. The forecast was made earlier this week before other jobs data prompted some economists to lower their estimates for job losses.

Ironically, The pro-Obama New York Times is far more cautious:

Yet even as the July numbers came in better than expected, the job market remains shaky in the months ahead.

“We’re a long way from the end of the employment problem,” said Brian Fabbri, an economist at BNP Paribas. “Things are improving, make no mistake. But were not near the time when businesses are going to hire again.”

Even if the economy begins growing again this summer — as many economists expect it will — laid-off workers are likely to be among the last to benefit. Businesses that slashed their work force and inventories over the last year to cope with the economic deterioration are likely to hire temporary workers or pay overtime wages before they begin fielding applications for new full-time workers.

COMMENT:  That is known as a jobless recovery, and is really no recovery at all.  But these latest figures will be trumpeted by the White House, and some Americans will be convinced that all is getting well again.

And we still have new, grave problems created by this administration - a huge increase in deficits, and a possible attempt to impose recovery-killing new taxes.

Any signs of recovery, though, will be helpful to the Democratic Party in maintaining its control of Congress next year.  This is going to be a tough fight in the most important midterm elections of our time.  Numbers will be soldiers in that fight.

August 7, 2009