New jobs will not dent high US unemployment rate - Fed economist

11 June 2010 00:05  [Source: ICIS news]

MYRTLE BEACH, South Carolina (ICIS news)--The US unemployment rate will barely dip in the next few years as the under-employed take up the new jobs, an economist with the Federal Reserve Bank of Richmond said on Thursday.

Growth in payroll jobs is "somewhat encouraging" and private-sector wages were increasing, said Rick Kagic of the Richmond Fed - one of the government banks that comprises the policy-making Federal Reserve system.

"The payroll employment recovery is finally upon us," Kagic told the Southeast Chemical Conference in Myrtle Beach, South Carolina.

"On aggregate, I think we will see sustained job growth going forward," he said.

While the economy as a whole has been improving already, but the employment picture has remained stubbornly bleak, he said.

Unemployment is considered a major impediment in particular to sales in the US automobile sector, one of the major end-users of many chemicals.

The unemployment rate dropped to 9.7% in May from 9.9% in April, but the fall was almost wholly due to temporary government workers hired for a nationwide census.

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