Posted in the Caruthersville Forum
Since: Mar 08
It's all Bush's fault!!!
U.S. job growth fell sharply, jolting financial markets and raising new questions about the strength of the nation's economy.
The U.S. added a paltry 69,000 jobs in May, the lowest total in a year. April brought only 77,000 new jobs, far lower than initially reported. The jobless rate climbed for the first time since last summer, to 8.2%. And the manufacturing sector, a previous source of strength, is slowing.
The collection of dismal reports comes on top of growing fears about European and Asian economies, and sent stocks sliding Friday morning.
That six-month average is a fine data point, but shows the three bad months came after the three good months. Job growth is slowing -- sharply -- no matter how you average out the numbers.
The slower growth deals a severe blow to President Barack Obama as he fights for re-election, giving Republicans new leverage.
With the U.S. economy looking weaker than it did just several weeks ago, pressure is mounting on the Federal Reserve to step in again with additional measures to stimulate growth. The divided Congress is expected to remain largely idle in an election year.
"The economy is shifting from 'muddling through' to paralysis," Pierpont Securities economist Stephen Stanley said.
The U.S. recovery appears to be tracking a similar pattern of the past three years, in which the economy gains steam during the winter only to run down in the spring and summer. But the situation this time is puzzling, given that there hasn't been a gas-price spike—prices instead have fallen--or a disaster, such as last year's Japanese earthquake and tsunami.
Instead, economists attribute the slower growth to a range of factors. A warmer winter than usual may have prompted businesses to hire earlier than they normally dol, boosting the jobs numbers early in the year. New concerns about Europe—including the prospect of a Greece exit from the euro—are rattling consumers and businesses. And uncertainty about domestic policy—including what happens with a variety of tax breaks that are set to expire at the end of the year—could be causing businesses to hold off on hiring.
Friday's labor-market report was disappointing nearly all around. Job growth over the past three months is less than half the average 250,000-plus jobs added in the three earlier months—and nearly every sector has been hit. Workers saw their weekly hours cut, a sign of weaker demand from customers. The ranks of the long-term unemployed rose.
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