Government Fails To Tackle Unemployment, As Sequestration Looms

The January jobs numbers released earlier on Friday show that while the private sector added 166,000 jobs, the government shed 9,000 positions in January.

Those job losses have ripple effects throughout the economy, economist Dean Baker explained. "If these people were still getting paychecks, they would have spent them, and that would have employed people elsewhere in the economy," the co-director of the Center for Economic and Policy Research told The Huffington Post. He estimated that government job cuts have cost the economy more than 1 million jobs total.

The unemployment rate rose to 7.9 percent in January, the Bureau of Labor Statistics reported Friday, not much lower than a year ago. In contrast, the unemployment rate averaged 4.6 percent just before the recession, according to BLS.

The government has cut 719,000 jobs since President Barack Obama took office, according to the Bureau of Labor Statistics. Some economists said this has stymied jobs growth, since the government is a major employer, and its employees' spending provides income to other workers.

"The stimulus was helpful, but it wasn't nearly enough," said Baker, who also blogs for The Huffington Post.

The government now is focused on deficit reduction instead of helping put people back to work, he said. "No one is talking about how we shouldn't be cutting the deficit; we really need more jobs and that means larger deficits. No one prominent in the debate is saying that."

- Huffingtonpost.com