Unemployment dips to 8.1% as more people stop looking for work
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) — The U.S. economy created just 115,000 jobs in April as hiring slacked off for a second straight month, according to the government’s latest employment figures.
The unemployment rate edged lower to 8.1% from 8.2%, but it fell because more people stopped looking for work. Some 342,000 people dropped out of the labor force to mark the second decline in a row, the Labor Department said Friday.
“The unemployment rate is falling for all the wrong reasons,” said Ryan Sweet, senior economist at Moody’s Analytics. The end of extended jobless benefits in many states may have contributed to the decline, he said.
The U.S. was expected to add 163,000 jobs in April, according to a survey of economists polled by MarketWatch.
Job growth in the last two months has been cut almost in half compared to the winter months of December through February, suggesting businesses may have turned cautious again. New hires averaged 252,000 in the winter months but have tapered off to an average of 135,000 in April and March.
Many economists believe an unusually warm winter pulled job creation forward at the expense of hiring that normally takes place in the spring.
Yet the slower rate of hiring in April is just one of many recent economic reports that have raised concerns about the whether the recovery is softening. The downturn in Europe and slower growth in China have exacerbated those concerns.
The U.S. was expected to add 163,000 jobs in April, according to a survey of economists polled by MarketWatch.
On the brighter side, job growth was revised modestly higher for both March and February. The increase in employment in March was revised up to 154,000 from an initial reading of 120,000. And the gain in February was revised up to 259,000 from 240,000.
In New York, U.S. stocks SPX -1.18% opened lower on Friday, and oil futures CLM2 -4.15% hovered around $100 a barrel.
In Washington, Republicans quickly launched a broadside on the White House, whose policies they blame for the slow recovery since the end of the 2007-2009 recession. Republicans have made the economy the centerpiece of their campaign to oust President Barack Obama at the polls in November.
“It’s a terrible and very disappointing report...This is not progress,” said Republican presidential candidate Mitt Romney.
The White House argues its policies prevented a deeper downturn and they point out that the U.S. has added 4.25 million private-sector jobs over the past 26 months.
“It is critical that we continue the economic policies that are helping us dig our way out of the deep hole that was caused by the severe recession that began at the end of 2007,” said Alan Kreuger, senior White House economic adviser.
