[Christine Romans, Co-host:] Welcome to YOUR MONEY. I'm Christine Romans. Ali will be here in a minute. We've important new information about the state of your job. During the recession, 8.4 million jobs vanished. Nearly one million more than the government originally reported. In January, the jobless rate unexpectedly fell to 9.7 percent dropping below 10 percent for the first time since September. We'll explain why in a moment. But here's what 2009 looked like, 4.8 million workers lost a job last year alone. Another 20,000 jobs disappeared in January of this year. But you can see the pace of job loss is slowing, with November even showing 64,000 jobs added. Ali, one of the president's top economic advisers Christina Romar, she says we are seeing signs of a healing labor market. It's not as simple as that is it?
[Ali Velshi, Co-host:] It is anything but simple, Christine I guess you can like it if you are thinking you have a cold and a cough and you take cough medicine and you buy over the counter medication and it doesn't go away and gets worst, then you go to the doctor, and then it's an infection. So you finally go and get the antibiotic and you take it and you just want this infection to go away, and what happens is, some of the symptoms go away and others still linger and you've got to go back and then you're you know, you are immune to the antibiotic. It's not simple at all. There are some bright spots. We created manufacturing jobs, even auto manufacturing jobs. But we're not growing at the pace that this economy needs to grow at in order to see a full recovery. But let's bring in some experts, Christine; we don't have to take our word for it. Rutgers professor William Rogers, he is the former chief economist at the U.S. Department of Labor joins us. Chrystia Freeland, our good friend, the U.S. managing editor at the "Financial Times" and Lakshman Achuthan is the managing director of the Economic Cycle Research Institute who has just published something that you can get at CNNMONEY.com. Lakshman this is your business. You follow business cycles at the point that we're at in this business cycle, good, bad or mixed on the jobs front?
[Lakshman Achuthan, Managing Director, Economic Cycle Research Institute:] Well right here, 2010, the business cycle is finally your friend. It hasn't been your friend for a couple of year. This year regardless of all the initiatives for jobs, the business cycle wins are at your back. You'll see as a result, this is going to be the first quarter of positive, solidly positive jobs growth. And that's going to persist. There's no new recession in front of us. But as you were just saying, recovering does not mean you're recovered. There are a lot of fits and starts. We're not out of the woods.
[Romans:] Bill Rogers, you used to crunch these numbers for the Labor Department in the Clinton years. And one thing I thought was interesting is during the Clinton years we created, what, 20 million jobs or something?
[William Rogers, Fmr. Chief Economist, U.s. Dept. Of Labor:] Twenty two million.
[Romans:] Twenty two million jobs and then you look at this recession, 8.4 gone. That shows you how staggering the depth of the job loss is for this recession. Good, bad or mixed? I'll ask you the same question Ali asked. Good, bad or mixed, this report?
[Rogers:] It is a mixed record. The drop in unemployment, 9.7 percent, it is a tale of two stories. It's continued this whole man session that the unemployment rates fell for men, because they left labor force. They were the ones who saw the increase in discouragement. The increase in the number of men who
[Romans:] So men simply dropped out? They said I have been looking for three years, I've been looking two years and they stepped out. That's why the unemployment rate fell?
[Rogers:] That is part of it. The other part of it is that women's unemployment rate also fell. And it is white men, too, but women's unemployment rate also fell during this time and that was because they were not dropping from the labor force. They were getting jobs, continuing in education, health services, and the sector retail trade added jobs and I believe all sorts of manufacturing.
[Romans:] Good point that you make because we know that overall the unemployment rate for blacks jumped or crawled to 16.5 percent.
[Velshi:] You know, Christine, that, you look at every other subdivision, you look at adult men, adult women, teenagers, whites and Hispanics, everybody else's unemployment rate as a percentage dropped. Blacks went up. They increased their proportion of the unemployed. That strikes me as something that's worrisome.
[Rogers:] It has persistently been very high and Mark Morale, president of the National Urban League and others they have been championing a second jobs bill that would really focus on more targeted types of investments in urban communities. To adjust these long-standing
[Romans:] One thing Chrystia I think is interesting is as we look at this volume of jobs lost and we think of what we were thinking about when the first stimulus was passed or actually the second stimulus, the big one, the $862. It was much worst actually than we thought when we were pushing that money out the door. Politically what do these numbers mean?
[Chrystia Freeland, U.s. Managing Editor, "financial Times:] " Well I think at the moment these numbers are a fairly good sign. I think the real political worry is not so much, though, focused on this jobs report, which is backward looking it is about what already happened, but what we're seeing happening going forward. And this has been a really worrying week, because we've seen some real danger signals from Europe. This whole recession, the financial crises were a reminder to us of how closely tied the U.S. now is to the world economy. And we are seeing real shakiness in Europe, a lot of people are starting to talk really seriously about their being an asset bubble already and you're seeing, I interviewed one the leading private equity guys on Wall Street this week. He said, I am selling everything I can. I think we are going into another bear market. Now if you haven't felt the recovery happen yet, that's terrifying, if the money men are saying, actually, we're heading for your downturn. I think that's becoming a possibility.
[Velshi:] Yes, we knew that jobs would be a lagging indicator, which means that they recover after the rest of the economy. But we know Chrystia that the markets are a leading indicator. So if the markets start to fizzle before the jobs start to grow you're left with this tepid growth period and that could be a problem.
[Freeland:] That is now looking like a real possibility. In a way that maybe it wasn't at the beginning of the year. People had been talking about you know, the possibility of a double dip recession. I think it's still too early to call that for sure. But is it looking now more likely than it was a couple weeks ago? Sure.
[Achuthan:] I would take the other side on that. OK. Respectively. Now I would say that you're not going to have a double dip recession. It's a misread here and it is reminiscent of the fall of '08, the system is fragile, it can't handle this. But here the leading indicators are telling us very clearly there is no new recession any where in sight. Yes, we have an easing of growth later on, because the U.S. economy cannot grow at around 6 percent. It just can't do that. That's way too fast for an economy of our size so you will have some throttling back, but that's normal and you will have this jobs growth coming in sooner than you think. We are just popping the surface here.
[Romans:] Let me get those last thoughts from you Bill. I mean because you are the guru on these numbers, really, help us understand what this means, because when we look back at that many jobs lost and then we are told by the administration that we're healing, the labor markets are healing, there are millions of people who don't feel like anything has been healed?
[Rogers:] Well, yes, and my sense is this additional 800,000 that were lost, they were going to announce this number, and they were going to announce it several months ago. So it's been in the market. But I think a little more psychological issue, is to whether or not one would say, yes I told you so. Now here's the proof in the pudding that things are really this bad and therefore, some people are going to play it out as, again, we need the second stimulus or we got to get the funds that have already been committed, $7 billion out much faster in particularly unemployment insurance benefits, health insurance benefits, food stamps for individuals. But then also what I think we've learned from the criticism about the first stimulus, the most recent stimulus, is if you're going to do it, it has to be targeted, targeted, and targeted on infrastructure. A dollar spent will get you more back than what do you if you keep the Bush tax cuts in.
[Freeland:] Mike, real concern, just the rest of the world. The question is, can America do it alone I think Christine Romar is right that the American jobs market is starting to heal, but if you start to see real flatness in the rest of the world, it's going to be really tough.
[Romans:] All right. We'll leave it there. The president says it's time for a serious spending freeze. But even as the massive stimulus continues to trickle out there are plans for billions more of your dollars to be spent on job creation and small business loans. Is this the best way and the best time to spend your taxpayer dollars?