Fri June 1, 2012
Just 69,000 Jobs Added In May; Unemployment Rate Edges Up To 8.2 Percent
Originally published on Fri June 1, 2012 1:31 pm
Horrid. Lousy. Awful.
Those are just three of the words economists are using to describe the news that just 69,000 net jobs were added to public and private payrolls last month — and that the nation's jobless rate edged up to 8.2 percent from April's 8.1 percent.
The news has raised fears that the hoped-for strengthening of the economy may not materialize.
We posted on the news and followed with details from the report and reaction to it. It's now 11:22 am. ET, here's our original post and earlier updates:
The nation's unemployment rate rose to 8.2 percent in May from 8.1 percent in April as just 69,000 jobs were added to public and private payrolls, the Bureau of Labor Statistics said this morning.
Both numbers are disappointments. Economists had expected BLS would say the jobless rate had stayed at 8.1 percent and that payrolls expanded by at least 150,000 jobs.
We'll be adding to this post as we gather more data from the report and reactions to it, so hit your "refresh" button to be sure you're seeing our latest updates.
Update at 11:20 a.m. ET: "Jobs slowdown adds to global fears," The Wall Street Journal says.
Update at 11:10 a.m. ET. Have Hopes Been Dashed?
Nigel Gault, chief economist at IHS Global Insight, writes that "2012 is beginning to look horribly like 2011 — initial high hopes that the recovery was kicking into high gear, subsequently dashed."
Update at 9:54 a.m. ET. Weak, Lousy, Horrid; Pick Your Word:
Reuters rounds up reactions from some economists here. Among the words they use for the news:
-- "Pretty horrid."
Update at 9:45 a.m. ET: White House Says Economy Is Still "Fighting Back" From Crisis:
"We are still fighting back from the worst economic crisis since the Great Depression," the president's top economic adviser, Alan Krueger, writes on the White House blog. "There is much more work that remains to be done to repair the damage caused by the financial crisis and deep recession that began at the end of 2007."
And he makes the case that "it is critical that we continue the president's economic policies that are helping us dig our way out of the deep hole that was caused by the severe recession."
Update at 9:34 a.m. ET: "Stocks Drop On Weak Jobs News."
Update at 9:26 a.m. ET. On The Political Impact; A "Gut-Punch For Team Obama":
"Why is this presidential race close? And why might it get closer?" asks MSNBC's First Read blog. "Look no further than today's jobs report for May, which is a gut-punch for Team Obama."
Update at 9:20 a.m. ET. Romney Calls Report "Devastating News," Blames Obama's "Failed" Policies.
The political repercussions are staring to be felt. Republican presidential candidate Mitt Romney's campaign just sent this statement to reporters:
"Today's weak jobs report is devastating news for American workers and American families. This week has seen a cascade of one bad piece of economic news after another. Slowing GDP growth, plunging consumer confidence, an increase in unemployment claims, and now another dismal jobs report all stand as a harsh indictment of the president's handling of the economy.
"It is now clear to everyone that President Obama's policies have failed to achieve their goals and that the Obama economy is crushing America's middle class. The president's re-election slogan may be 'forward,' but it seems like we've been moving backward. We can do so much better in America. That's why I'm running for president."
Update at 9:11 a.m. ET. "An Awful Recovery":
Our colleague Jacob Goldstein this morning looked at "Three Years Of An Awful Recovery," over at the Planet Money blog.
Update at 9:07 a.m. ET. Income, Consumer Spending Figures Also Weak:
Meanwhile, the Bureau of Economic Analysis says Americans' personal income rose just 0.2 percent in April from March and that consumer spending grew by a modest 0.3 percent. The income gain, the slowest in five months, raises concerns "about the ability of Americans to keep spending in the future," The Associated Press writes.
Update at 9:04 a.m. ET. "Marginally Attached" Workers Also On The Rise.
Another sobering detail from the report:
"In May, 2.4 million persons were marginally attached to the labor force, up from 2.2 million a year earlier. ... These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey."
Update at 9:01 a.m. ET. There Are 5.4 Million "Long-Term Unemployed":
According to BLS, "the number of long-term unemployed (those jobless for 27 weeks and over) rose from 5.1 to 5.4 million in May. These individuals accounted for 42.8 percent of the unemployed."
Update at 8:58 a.m. ET. What's Going On? "Broad Uncertainty":
Here's how The Wall Street Journal is summing things up:
"Nearly three years after the recession ended, the economy has failed to gain traction amid broad uncertainty related to Europe's debt crisis, the potential for steep U.S. tax increases and spending cuts next year, and signs of slower growth in developing countries."
Update at 8:55 a.m. ET. Stock Futures "Plummeting."
From The Associated Press:
"U.S. stock futures are plummeting after the release of a report on the job market that was far weaker than economists expected. Dow Jones industrial average futures, which were down 100 points before the report came out at 8:30 a.m. ET Friday, dropped an additional 100 points within minutes."
Update at 8:49 a.m. ET. A Vicious Cycle?
Economists sometimes talk about "virtuous" and "vicious" cycles. Basically, once the economy gets on a roll it can continue to expand as confidence, incomes and jobs all rise and build on each other. Conversely, when things aren't going well that can create a downward spiral.
"Bigger job and wage gains are needed to jumpstart a self- sustaining increase in hiring and consumer spending that will boost the expansion. At the same time, a looming recession in the euro area and slower growth in China and Brazil may prompt American companies to reduce headcount until they see more evidence the U.S. economy isn't faltering."
Update at 8:47 a.m. ET. A "Sputtering" Economy?
Here's how The Associated Press sums up the news: "The dismal jobs figures could fan fears that the economy is sputtering."
Update at 8:46 a.m. ET. Sharp Slowing From First Quarter:
According to BLS, in the first quarter the average monthly gain in payrolls was 226,000. But payrolls grew by just 77,000 in April and 69,000 in May.
Update at 8:44 a.m. ET. Number Of "Discouraged Workers" Remains High:
In another sign of the labor market's weakness, BLS says "there were 830,000 discouraged workers in May, about the same as a year earlier."
Update at 8:39 a.m. ET. Sharp Downward Revision Of April's Gain:
BLS initially thought payrolls grew by a net 115,000 jobs in April, but now says just 77,000 positions were added that month.