Unemployment Rate Dips to 6%, Lowest Since 1979

The nation’s unemployment rate dipped to 6% in July, the lowest mark in this decade and an achievement hailed today by President Reagan as proof his economic policies are right.

Appearing before White House reporters about two hours after the Labor Department reported a July employment gain of 470,000 jobs, Reagan hailed the report, which recorded a 0.1 percentage point drop in the jobless rate.

The job gains were spurred by an unusual, seasonally adjusted growth in manufacturing payrolls that more than offset a decline of 190,000 in the previous month.

Two million more Americans now have jobs than was the case at the beginning of the year, the Labor Department’s monthly household survey showed. Over the last 12 months, the nation’s jobless rate has fallen a full percentage point.

(California’s unemployment rate held steady at 5.5% in July with a net gain of 75,000 jobs during the month, labor officials reported today. California ranked sixth in unemployment among the nation’s 11 largest industrial states.) Of today’s national unemployment report, which recorded the lowest unemployment rate since December, 1979, Reagan said:

“This breakthrough does not occur in a hyper-inflated economy but is based instead on strong growth and steady job creation.”

He called the unemployment report “remarkable news.”

Reagan zeroed in on the lower of two monthly unemployment rates the Bureau of Labor Statistics releases, based on a random survey of U.S. households. That rate, which combines the civilian and military labor forces, dropped to 5.9% last month.

Most economists discount that rate, which includes the approximately 1.7-million-member U.S. armed forces contingent in the United States. Many analysts say that including the full-employment armed forces pool with civilians plays down the effects of economic changes on the nation’s work force.

The jobless rate for the civilian labor force dropped to 6.0% last month, down from 6.1% in June.

“The economy is performing well,” the President said. “All of this is excellent news for the American economy and for the American people.”

In a brief appearance before reporters today, Reagan pointed to new jobless figures as proof that his economic policies are right.

“It was the right decision to take to the country the message I have during the past six months, that deficit spending, tax increases and protectionism threaten our hard-won prosperity,” Reagan said. “I believe this is a message the American people are responding to.”