Officials Say Jobs Will Grow Next Year, but It Will Be a Long Road Back

Top Obama administration economic officials, as well as former Federal Reserve Chairman Alan Greenspan, expressed confidence today that job growth will resume next year, but they cautioned that it will take time until the unemployment rate returns to its pre-recession levels.

Greenspan, speaking on NBC's "Meet the Press," predicted that unemployment "will be significantly lower a year from now" but that the unemployment rate itself will not go down "very quickly or very dramatically" because people who have currently given up looking for jobs will start trying to get back in the market and expand the size of the pool of people looking for work. Greenspan said it takes 100,000 new jobs a month to "stay even" with the growing labor pool.

Appearing elsewhere on the Sunday talk circuit, Christina Romer, chairman of the White House Council of Economic Advisers, and Lawrence Summers, director of the White House National Economic Council, echoed Greenspan, pointing to the predictions of private forecasters that job growth will resume this spring but adding their view that it will be a long road back.

"It will take time," Summers said on CNN's "State of the Union." "A year ago, the question was, 'Would we have a depression?' Today everyone agrees that the recession is over."

Asked on "Meet the Press" whether joblessness will be significantly lower by this time next year, Romer said, "I feel confident it will be on the way down. . . . What I feel confident is, is that we are on the right trajectory." But she, too, added, "This recession took a long time coming; it's going to take a long time coming out."

But Romer had a different take than Summers on whether she considered the recession over. Putting aside some of the official measures, such as growth in gross domestic product, Romer said, "Of course not. For the people on main street and throughout this country, they are still suffering." She said, "You're not recovered until all those people that want to work are back to work" and unemployment is back in the pre-recession 5 percent range.

Greenspan said the current recession and its devastating impact on the job situation differ from a previous deep recession in 1981-1982 -- when jobs returned more quickly -- because the situation was compounded by last year's financial meltdown.

"Business got very frightened when the crisis occurred and presumed the economy was going to go down far more sharply than it actually did," he said. "What this means is that we have a level of employment at this stage barely adequate to staff the level of output. It seems to me virtually inevitable if nothing else were to happen that employment would start to come back fairly quickly."

"What really concerns me is that 38 percent of the total unemployment are those unemployed more than 27 weeks and, indeed, a significant part of that is a year or more," Greenspan said. "These people are losing their skills, and it is very critical that those people have the skills when the economy comes back or we will not be as productive as we'd like to be."

Also on NBC, former Massachusetts governor and onetime GOP presidential candidate Mitt Romney had sharp criticism of President Obama for what he said was the failure of the administration's first economic stimulus package to meet its promised goal of holding unemployment under 10 percent, as well as new stimulus proposals Obama announced this past week.

Romney said, "I think first of all he's admitting that what he put in the place at the beginning of the year, almost a trillion dollars of stimulus spending, hasn't done what it was intended to do." Romney called it an "extraordinary failure."

"It has been a jobless stimulus, and that's unfortunate because the president had an opportunity to focus on the economy to create jobs, but instead Nancy Pelosi and Harry Reid created something that stimulated government."