If the Federal Reserve Board’s monetary policy gurus hoped that Friday’s jobs report would give them solid guidance as to how to set future monetary policy they were sorely disappointed. The jobs situation neither deteriorated sufficiently to justify another round of easing, nor improved sufficiently to allow the monetary policy committee to back off its statement that it “will closely monitor incoming information … and will provide additional accommodation as needed.” The information being monitored will not be restricted to the U.S.: The Fed is keeping a wary eye on the deteriorating situation in Europe, especially on European Central Bank president Mario Draghi, who after promising to do “all that it takes” to save the euro, last week reverted to eurospeak, announcing he will use the next months to “design the appropriate modalities” for future policy. Not quite the same as “doing whatever it takes.”

The U.S. economy did record 163,000 new jobs in July, 172,000 in the private sector, offset by a few losses in the public sector. The unemployment rate ticked up from 8.2 percent in June to 8.3 percent in July (half that for those with a bachelor’s degree and higher), making it 42 months above 8 percent. Over 5 million of the 12.8 million unemployed have been out of work for more than 27 weeks, making it possible that their skills have deteriorated or even become obsolete, as employer complaints about their inability to find qualified employees suggest. Worse still, 23.5 million workers, 15 percent of the nation’s total, are unable to find full-time work or are too discouraged to continue the job hunt. This is quite simply the worst three-year recovery in the post-war period.

Dig a little deeper and you find numbers that might affect the race for the White House. The unemployment rate for three important groups that President Obama is counting on to turn out in large numbers is well above the 8.3 percent national average. Over 10 percent of Hispanics, 14 percent of blacks, and almost 24 percent of teenagers are jobless. The latter are among the young people whose enthusiasm for Barack Obama helped fuel his 2008 election win.

They are not likely to be as enthusiastic this time around. A study by William Emmons and Bryan Noeth of the Federal Reserve Bank of St. Louis shows that the largest percentage wealth losses in the recession “were suffered by younger families.” And young people, some of them emerging from institutions of what is laughingly called higher learning, find themselves entering a cruel world, with jobs so scarce that many of them have had to move back in with parents who are not uniformly delighted at this repopulating of what was an empty nest. Youngsters who in the not-too-distant past could choose among competing employers, now find they out-number available jobs. And it might get even tougher.

China, whose workers snatched millions of unskilled jobs from Americans in the manufacturing sector, is turning its attention to high-skilled work. The World Bank reports that China is producing six million graduates every year, and by 2030 will add 200 million graduates to the global labor force. “One possibility,” says the Wall Street Journal, “is that professional wages and employment in the US will come under increased competitive pressure.” A lesser but non-trivial addition to the world’s skilled labor force will come from Saudi Arabia, which sent 1,000 students to study in America, and 66,000 this past school year. Like their UK counterparts, U.S. universities lust after the fees foreign students pay, and have enrolled over 723,000 such students in the past year, up 32 percent from a decade ago according to the Chronicles of Higher Education. All good for the world economy, but a source of worry for American students famously less diligent than their Chinese competitors, due perhaps to an insufficient supply of Tiger Mothers.

Nor is any of this likely to improve soon. Stanford University professor Edward Lazear estimates that the rate of job creation is so slow that employment will not reach pre-recession levels until 2016. One “headwind,” to use the word now applied to any drag on economic growth, is the situation faced by small businesses. Studies by Lowell Ricketts and Juan Sánchez, also of the Federal Reserve Bank of St. Louis, show that small firms did a better job of maintaining employment in the recession than did big companies. And these small companies are generally regarded as key to any acceleration in job creation. But small firms are being hit especially hard by the provisions of Obamacare. If they grow to more than 50 employees they will have to provide expensive health care insurance, or pay a fine. Several fast-food franchisees report that in order to avoid these ruinous costs they have aborted plans to grow beyond 49 workers. 

In a land of bad news, even moderately good news is a reason for rejoicing. The housing market continues its steady rebound. The closely watched S&P Case-Shiller home price index has risen for four consecutive months in 18 of the 20 cities covered by the index, and all 20 cities recorded increases in May, the last month for which data are available. Prices are now about where they were at this time last year—a big deal after continual reports of drops from year-ago levels. Inventories of unsold homes and vacant homes offered for rent are down. Along with continued low mortgage interest rates, this improvement in prices and the inventory picture has driven shares in homebuilders up some 50 percent this year, about five times the rise in the overall S&P index of 500 shares. But even in this sector there are reasons to worry. After a strong May, sales of newly-built, single-family homes plunged by 8.4 percent in June. And pending home sales—deals that are agreed but not completed—also fell.

There are other shards of good news. More and more homeowners are refinancing their mortgages—trading in higher- for lower-interest mortgages, saving some $2,500-$3,000 per year, cash that should in good part find its way into store tills. And earlier today the Institute for Supply Management (ISM) reported that the service sector grew in July for the 31^st consecutive month, with new orders increasing for 36 straight months. But non-manufacturing employment, which had been growing, contracted.

All in all, as Art Cashin, veteran director of floor operations for UBS Financial Services told a CNBC television audience, we are “above stall speed, but not by much … not enough to write home to mother about.” Or allow Fed chairman Ben Bernanke to plan a leisurely summer vacation.