MW: May jobs growth slows to 54,000, a nine-month low
Jobless rate up to 9.1%, worst since December
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — In disappointing news for the White House, Wall Street and Main Street, U.S. job gains slowed to a crawl in May and the unemployment rate moved higher, the Labor Department estimated Friday.
Nonfarm payrolls rose by a seasonally adjusted 54,000 in May. This is the smallest gain since September and a fraction of the 125,000 jobs expected by economists polled by MarketWatch.
That forecast had been cut in recent days as economists grew pessimistic after a string of disappointing data this week. Just a few days ago, economists were expecting jobs growth of 175,000 jobs in the month.
The official unemployment rate increased to 9.1% in May from 9.0% in April. This is the highest unemployment rate since December. Economists were expected a slight drop in the jobless rate to 8.9%.
The unemployment report adds to fears that the U.S. economy may have hit more than a soft patch and that a more protracted and dangerous downturn could be in the offing.
Stock futures SPM11 -0.97% sold off sharply after publication of the report, as did silver and gold. The dollar USDYEN -0.8651% dropped against the Japanese yen.
Prior to the report, economists blamed the slowdown on higher gasoline prices, a slowdown in manufacturing caused by lack of parts from earthquake-wracked Japan, and deadly storms in the Midwest and the South.
Labor Department officials rejected the notion that the storms had affected the report.
“We found no clear impact of the disasters on the national employment and unemployment data for May,” said Keith Hall, commissioner of the Bureau of Labor Statistics, in a statement.
Total payrolls were revised down by 39,000 for March and April. March’s gain was revised to 194,000 from 221,000, while April’s gain of 244,000 was revised to a gain of 232,000.
There was no sign that hiring at McDonald’s boosted payrolls. Food and drinking employment rose by 13,600 jobs in May after adding 28,000 workers in April.
A more detailed estimate for May fast food hiring will be available with a one-month lag, officials said.
