Jobless Rate up to 9.1% as Economy Slows Down Again

June 6, 2011 04:31

No American president has ever been re-elected with an unemployment level about eight percent.

From The Americano

The economy added only 54,000 jobs in May, much fewer than economists had expected, and the unemployment rate increased to 9.1% in May.

If the economic news was bad, politically it was worse for President Barack Obama and his re-election campaign. No American president has ever been re-elected with an unemployment level about eight percent.

With all economic indicators now trending down, and Washington out of ammunition to stimulate the economy, the picture was dismal indeed.

According to the Bureau of Labor Statistics (BLS) there were only 54,000 jobs added in May, and the least number of persons hired in eight months.

Stock futures decline sharply on the report, indicating a big selloff at the Wall Street open.

The Associated Press said it differently. It said the Labor Department report offered startling evidence that the U.S. economy is slowing, hampered by high gas prices and natural disasters in Japan that have hurt U.S. manufacturers.

The pace of hiring has weakened dramatically from the previous three months, when the economy added an average of 220,000 new jobs. Private companies hired only 83,000 new workers in May — the fewest in nearly a year.

The story added that the anemic pace of job creation presents a huge challenge to President Barack Obama’s reelection prospects next year. And it followed a string of disappointing economic data in the past month that suggest the economy is hitting a soft patch after a strong start.

· The manufacturing sector, a key driver of the economic recovery, grew at its slowest pace in 20 months in May. Home prices are still falling and reached their lowest level since 2002 in March

· Higher gas prices have left less money for consumers to spend on other purchases. And average wages aren’t even keeping up with inflation. As a result, consumer spending, which fuels about 70 percent of the economy, is growing sluggishly.

· More people entered the work force in May. But most of the new entrants couldn’t find work. That pushed the unemployment rate up from 9.0 percent in April. The number of unemployed rose to 13.9 million.

· And the government revised the previous months’ job totals to show 39,000 fewer jobs were created in March and April than first thought.

Hispanics were one of the few groups where unemployment improved in May. Unemployment among Hispanics came down from 12.4 percent in April to 11.3 percent in May.

Furthermore, 8.5 million Americans worked part time, even though they would have preferred full-time jobs; and another 2.2 million have stopped looking in the past year. All told, the “under-employment” rate was 15.8 percent, down from 15.9 percent the previous month.

The Americano/Agencies

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