(Bloomberg News) Pacific Investment Management Co.'s Bill Gross said the U.S. is in an "anemic, jobless recovery" where there is little real wage growth after a government report showed employment rose at the slowest pace in four months.
The firm has a "little more dourer outlook" than the Federal Reserve when it comes to growth, Gross, manager of the world's biggest bond fund, said in a radio interview on "Bloomberg Surveillance" with Tom Keene and Ken Prewitt.
The 80,000 increase in payrolls was less than forecast and followed gains in the prior two months that were revised up by 102,000, Labor Department figures showed today in Washington. The unemployment rate fell to a six-month low of 9 percent from 9.1 percent even as the labor force expanded.
"You need 200,000 jobs basically a month, and we are not seeing that, to reduce unemployment," said Gross in the interview from Pimco's headquarters in Newport Beach, California. "So it would suggest the 9 percent number is going to be with us for a long, long time. We are facing structural headwinds that have relatively little to do with a cyclical rebound."
Fed policy makers said this week that the economy has picked up while "significant downside risks" remain, and they refrained from taking any additional steps to ease monetary policy. Fed Chairman Ben S. Bernanke and his colleagues left unchanged their pledge to keep the benchmark interest rate near zero through at least mid-2013 as long as unemployment remains high and the inflation outlook stays "subdued" at the completion of their regular rate setting meeting on Nov. 2.
"The bad news is that we are still in this unemployment crisis," said Pimco Chief Executive Officer Mohamed El-Erian in a separate interview on Bloomberg Television's "In the Loop " with Betty Liu. "It doesn't do enough to remove the risk of stall speed. There is growth, but not fast enough growth."
Fed officials also lowered their economic-growth projections compared with June and said the unemployment rate will decline at a slower pace. Gross domestic product, adjusted for inflation, will rise by 2.5 percent to 2.9 percent next year, compared with a range of 3.3 percent to 3.7 percent from the prior projections in June, according to the median range of economic projections from the 17 governors and regional Fed presidents. Growth in 2013 will be 3 percent to 3.5 percent, lower than the prior range of 3.5 percent to 4.2 percent.
The jobless rate in the fourth quarter of 2012 will range from 8.5 percent to 8.7 percent, up from the previous forecast of 7.8 percent to 8.2 percent, the Fed said in a release separate from the FOMC statement.