Obama expects unemployment to rise

President Obama said Tuesday that unemployment numbers will likely "continue to tick up for several months.”

Obama’s comments come two months after a member of his Cabinet predicted that the economic stimulus package would cause unemployment rates to drop.

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The president recently said he expects the national unemployment rate to reach 10 percent, which hasn’t happened since 1982.

Asked on Tuesday how high he thinks unemployment rates will increase in hard-hit states like Michigan, Obama responded, “Obviously, I don't have a crystal ball. We have looked at a lot of the economic data that's coming out right now. And, as I've said repeatedly, we have seen some stabilization in the financial markets.”

Obama delivered his remarks in the Oval Office following a meeting with Dutch Prime Minister Jan Peter Balkenende.

Michigan’s unemployment rate is now 14 percent. Obama is scheduled to deliver a speech in the Wolverine State on Tuesday afternoon.

Obama indicated he is optimistic that the economy will improve, but did not make any bold predictions on when that will occur: “What we have also seen is that historically, even after you start moving into a recovery, positive growth, hiring typically lags for some time after that. That's been the historic norm.

“Now, this has been a more severe recession than we've seen since the Great Depression. So how employment numbers are going to respond is not yet clear.”

The president defended the stimulus, which his administration earlier this year suggested would keep the unemployment rate to around 8 percent. The nation’s unemployment rate is 9.5 percent. And Obama anticipates that the trend will continue over the short-term.

He said, “My expectation is that we will probably continue to see unemployment tick up for several months.”

Michigan, Obama said, “is a state that has just been battered, not only during this recession but in the years leading up to this recession. We're pleased to see that GM now and Chrysler have gotten out of bankruptcy. … Had it not been for the steps that we took with respect to GM and Chrysler, the situation in Michigan, I think it's fair to say, would be far worse.”

Likewise, the president said the stimulus prevented further damage to the economy: “We've made investments that early on have allowed a state like Michigan to lay off fewer teachers, fewer cops, fewer firefighters. Those are all jobs that would have been lost in the absence of the recovery package. But it's still not enough.”

Congressional Democrats and the Obama administration have shifted their talking points on the stimulus in the wake of dismal job data.

Sen. Charles Schumer (D-N.Y.) said on Monday that the economic stimulus accomplished its first goal of preventing a great depression and cautioned against rush judgments about whether the $787 billion package is a significant job-creator.

But in May, Secretary of Transportation Ray LaHood predicted the stimulus would lead to lower unemployment rates.

During a speech at the National Press Club, LaHood said, "I do think you will see unemployment rates begin to come down as the transportation sector really up-ramps its opportunities with the dollars that we will be providing."

At the time of LaHood’s speech, the nation's unemployment rate was 8.9 percent.

A day before LaHood’s prediction, the White House projected that the stimulus would save or create 1.5 million jobs by the end of 2009.

Michael M. Gleeson contributed to this article.