Obama blames Europe debt crisis for weak US employment growth

Rise in unemployment rate in May strikes a blow to president’s re-election prospects

President Barack Obama speaks at a campaign event at Chicago Cultural Center
Image Credit: AP
President Barack Obama speaks at a campaign event at Chicago Cultural Center on Friday. He spoke at length about the disappointing jobs numbers.
Gulf News

Washington: President Barack Obama yesterday blamed Europe’s sovereign debt crisis for the slowest month of US employment growth in a year, seeking to counter an issue weighing on his re-election bid.

“We’re not where we need to be; we’re not there yet; you saw that in today’s jobs report,” the president said at a Chicago fundraiser, the fourth of six yesterday in the Midwest. “A lot of that’s attributable to Europe and the cloud that’s coming over from the Atlantic. The whole world economy has been weakened by it, and it’s having an impact on us.”

Obama’s prospects for a second term suffered a blow yesterday with a US Labour Department report showing payrolls expanded by 69,000 last month, less than the most pessimistic forecast, while the unemployment rate rose to 8.2 per cent from 8.1 per cent.

Both Obama and Republican challenger Mitt Romney have sought to make the economy the focus of the election. The president says the former Massachusetts governor backs policies that brought the US into a crippling downturn, while Romney, a co-founder of the Bain Capital LLC private-equity firm, asserts Obama lacks the business acumen needed to lead an economic turnaround.

Rescue of auto industry

Chicago Mayor Rahm Emanuel, the president’s former chief of staff, introduced Obama to about 350 people at the event, with tickets costing at least $2,500 (Dh9,182) per person. Emanuel said that, through “sheer force of will”, Obama has helped create jobs, including by leading a rescue of the US auto industry.

General Motors Co. and Chrysler Group LLC yesterday reported sales gains for May that trailed analysts’ estimates. GM deliveries last month rose 11 per cent, while Chrysler’s climbed 30 per cent. Analysts had estimated gains of 15 per cent by GM and 40 per cent by Chrysler.

Speaking about the disappointing jobs numbers, Obama told attendees at the second Chicago event that the interconnected global economy means, “When something happens across the Atlantic or across the Pacific, it gives us a shock.”

“Despite all that, though, we’re moving in the right direction,” he said. “But we’re not moving as fast as we could be.”

The president stayed overnight at the Georgian-style three-storey red brick Chicago house that he and first lady Michelle Obama bought in 2005. Yesterday night marked only the 11th time he has spent the night at his home since taking office and his first since April 14, 2011.

“I am sleeping in my bed tonight. I’m going to go into my kitchen. I might cook something for myself,” he told the crowd at the Chicago Cultural Centre.

Prospects for close election

The fundraisers in Minnesota and Chicago took in at least $5 million. At one of three events in Minnesota earlier in the day, Obama said the November election will be “close,” not because the other side has great ideas, but because “the economy is still fragile.”

At each of the four fundraisers that were open to the media, Obama said that the US’ economic woes are due in part to the continuing debt crisis in the Eurozone.

“Europe is having a significant crisis in part because they haven’t taken as many of the decisive steps as were needed to deal with the challenge, and that’s weakening Asia and that means it’s harder for our exports,” he told supporters.

Loading...