August 5, 2011 / 3:40 PM / 8 years ago

UPDATE 2-Obama on economy: We are going to get through this

* Obama cites “extraordinary” uncertainty in Europe

* Says Democrats, Republicans must work together

(updates with quotes)

By Jeff Mason and Steve Holland

WASHINGTON, Aug 5 (Reuters) - U.S. President Barack Obama said on Friday the U.S. economy had faced a “tumultuous year” and more measures were needed to boost job growth but he reassured Americans that the situation would improve.

Noting that financial markets had had a “bumpy ride” recently, Obama welcomed a Labor Department report that showed 154,000 private sector jobs were created in July and the jobless rate ticked down slightly to 9.1 percent. ID:nOAT004847]

Obama, whose 2012 re-election hopes depend largely on his ability to resuscitate economic growth, said his “singular focus” now was getting the unemployed back to work, boosting wages and helping Americans recover from the recession.

“What I want the American people and our partners around the world to know is this: We are going to get through this. Things will get better,” he said in an address to veterans.

“We need to create a self-sustaining cycle where people are spending and companies are hiring and our economy is growing and we’ve known that will take some time,” he said.

Obama emphasized that many outside forces had affected the U.S. economy, including the effect of uprisings in the Arab world on oil prices, the earthquake and tsunami in Japan, and the “extraordinary economic uncertainty in Europe.”

The president’s options for boosting economic growth are limited.

Republicans, who control the U.S. House of Representatives, oppose further stimulus spending and both parties have shifted focus toward cutting spending and reducing the deficit.

“WE’VE GOT TO DO BETTER”

Obama, a Democrat, lamented that an impasse between the two political parties over raising the U.S. debt ceiling had taken so long to get resolved.

“The bipartisan compromise on deficit reduction was important in terms of putting us on sounder fiscal footing going forward but let’s be honest: the process was divisive, it was delayed,” he said.

“If we want our businesses to have the confidence they need to get the cash off the sidelines and invest and hire, then we’ve got to do better than that. We’ve got to be able to work together to grow the economy right now and strengthen our long-term finances.”

When the U.S. lawmakers return to Washington in September, Obama said he wanted them to move quickly to extend a payroll tax cut and unemployment insurance in an effort to boost jobs.

Nodding to the anti-government-spending mood in Washington, Obama said getting the economy on solid footing would help reduce the deficit over time.

“There’s no contradiction between us taking some steps to put people to work right now and getting our long-term fiscal house in order,” he said. “In fact, the more we grow, the easier it will be to reduce our deficits.” (Additional reporting by Caren Bohan; Editing by Bill Trott)

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