American Economy-Whether heading to a second recession?
Loss of jobs
A recent news release from IANS says that about 54,000employees have lost their jobs in America just in the month of August alone.The percentage of unemployeds has grown from 9.5% to 9.6% in August.Opposition parties in USA had criticies President Obama for this development,i.e for having failed to take appropriates steps to combat rising unemployment situation.
In answer to this ,Mr. Obama has announced that the 'Encouragement package' will be designed soon and announced.
It is reported that majority of job losses has taken place in government undertakings .This clearly indicates that the failure is in the managing of the firms, not in the working of the employees.
More labourers sent home
Apart from above said 54,000, the labour department has rel.ieved 1.14 lacs of emploees,who wre working on temporary basis. Apart from this, private firms have sent 67,000 emploees back home,in past couple of months.
Creation of jobs?
Inspite of this, another report says that 7.63 job oppurtunities arre created in Us since Jan-2010 .Mr.Obama has reacted to this report telling "This is a good news"
Indeed that should be a good news,if true.
President Obama has refuted the news that Country is heading towords a second recession in Economy,but stated,
' we are heading in right direction.But the Economic growth rate is slow.Our present need lies in speeding it up.We have faulted by slowing the processs of shapiong appropriate rules to encourage small scale industries and loan rules relarted to them".
But Only words cannot console citizens and sufferers.Action, that too AT A WARFOOTING, IS needed to keep the earners and job seekers at peace. Let the people have that peace.
One day after the publication of this hub,the news is out that the state of OHIO in USA has issued an order banning any outsourcing work to countries outside America.This is an effort to increase job oppurtunities to American youths.There is no fault in it as such.
But the problem is of time.When American life style has long back adopted speed,Getting work done therre itself may become costlier and time consumung.The firms may have to slow down their working and supply speed .That may hamper American firms from another side.
Only time and experience can tell whether the step is right or not.
FURTHER NOTE (added on 9/13/2010)
Indian govt. has sharply reacted to this banning by America.Indian I.T. companies also have , naturally, reacted negetively.
We have to note the dual action American governments regarding their policies about other countries.USA streesed manytimes on the opening of tradegates to its companiers to trade in developing countries. It is pressing India and other countries to stop giving subsidies to agriculturists.But America itself is subsidising its farmers eventhough their percentage is only 2.But it restricts India not to give subsidies to farmers eventhough they are about 80% of our population. Similarly, when it asks other countries to open gates to American products, it never thinks that the companies of those countries will suffer.
Everyone will change his policy,when self interest suffers!
Mr.Anand Sharma, Union minister for Commerce,has recently reacted to this step of America,has , according to PTI ,reacted liker this-"By rising VISA fee and restricting Outsourcing, America is trying to prevent entry of Indian aspirants to Anmerica.But in August only ,Indian IT companies have created 7000 job oppurtuniuties in USA.In last 3 years 2.5 lakh employment is created in America by Indian IT companies.But recent VISa and TAX policies have created problems." Mr. Sharma expressed the intension to discuss the issue with his American counterpart, in the meeting scheduled to take place shortly between him and Ron Kirk.
Anyway, much cannot be expected from that meet.!
According to National Bureau of economic research(NBER) America has exited from Economic recession in June 2009 itself.The report was released just last week.
According to report,about 8,00, 00,00(eight million)people have lost their jobs due to recession.Now job chances are again opening-it says.
But President Obama is not at all happy at the 'ending' of the recession. THE HINDU daily, quoting its Washington reporter, says Mr. has said"Eventhough the recession is officially over,last year, obviouslyfor millions of people who are still out of jobpeople who have seen their home values decline,people who are struggling to pay bills day to day, its still very real for them".
YES,Mr. Obama's feelings are right.
Is USA recovering?
Now, several months after after publishing this hub, now, in Nov,2011, it seems to outsiders like we Indians, that American economy is perhaps recovering.This flash come because, rupee rate against dollar has fallen to a 3 years low,to 52.40 or so rupees per US dollar.This is alarming.Is this due to steps taken by obama govt. to bring up their economy.Not only Indian currency, but other European currencies are also falling against US currency. Is it indicating that American Economy is coming back to its normal line?
It seems now, after two years of first publication of this hub, scenario of American finance and Economy is changing.Dollar is becoming stronger and other currencies, especially Indian rupee, are sliding down.Gold rate is at a halt almost, as the dollar is on a strong foot.
Now, the scenario has changed in favor of American currency. It has become strong. The stock market in New york and other American cities are showing good trade on the positive side since some months. Indian rupee, that stood strong at around Rs. 63 per $, has now lost by approximately paise since 22nd July.
These developments show that American government took propr measures to come back to the forefront.