The job market has often been cited as the most fundamental problem in the economic recovery. With few employment opportunities, Americans cut back on their spending, and since consumer activity accounts for roughly two-thirds of the economy, the entire market suffers.
But that cycle tends to fall into a vicious one, as poor sales also tend to curb hiring trends. A survey of economists released this week by The Wall Street Journal confirms this theory.
According to the report, of the 51 economists who responded to the question of why employers aren't hiring more readily, 31 credited lack of demand (65 percent) and 14 (27 percent) pointed to uncertainty about government policy.
"There is no demand," Paul Ashworth of Capital Economics told the Journal. "Businesses aren't confident enough, and the longer this goes on the harder it is to convince them that they should be."
Other recent improvements in the availability of credit to consumers may help boost demand and spending in the sector. However, the vicious cycle seems far from broken and will likely take months to show signs of improvement.