Weak U.S. June jobs report ‘shocker’

On Friday July 8, 2011

The U.S. added 18,000 jobs in June, far fewer than the 120,000 that many economists had been hoping for, the U.S. Bureau of Labour Statistics reported Friday.

“The June jobs report was a shocker,” said Nigel Gault, chief U.S. economist for IHS Global Insight. “It was far worse than expected, and weak on all key dimensions — job creation, unemployment, the length of the work week, and hourly earnings.”

The unemployment rate edged up by one-tenth of a percentage point from May, to 9.2 per cent. The rate is up by 0.4 of a percentage point since March.

Employment in the private sector rose by 57,000, the weakest month since May 2010, while government employment fell 39,000.

Economists had initially been expecting to see 90,000 jobs added in June, according to a survey by FactSet. But after the release of strong economic data earlier this week, many economists raised their estimates to 120,000 jobs, and some jumped to 200,000.

The June numbers are especially disappointing because a big jump would have suggested the 54,000 jobs added in May was a temporary setback.

But with the June increase so low, the economic recovery is still moving very slowly. The revision of the increase in May job numbers, cut by more than half to 25,000 from 54,000, was another discouraging sign.

“The recent pattern of jobs suggests that the economy hit a brick wall in May,” Gault said.

Stock markets dropped with the report, indicating the concern with the progress of the recovery.

There are now 14.6 million people officially unemployed in the U.S, and since March, the number has risen by 545,000, the department said.

There were another 8.6 million people working part time because their hours had been cut back or because they were unable to find a full-time job.

And 2.7 million people were not in the labour force, but wanted employment, were available for work, and had looked for a job in the prior year. But they were not counted as unemployed because they had not searched for work in the four weeks before the survey. http://ca.finance.yahoo.com/news/Weak-U-S-June-jobs-report-cbc-3369600238.html

Despite Jobs Disappointment, Buffett Still Doesn’t Expect Double-Dip

Warren Buffett acknowledges that this morning’s June jobs report is disappointing, but he’s sticking with the economic optimism we heard in yesterday’s CNBC live interview.

While some are saying the economy may be heading back to a recession,Buffett tells Bloomberg

this morning, “I would bet very heavily against that. How fast the recovery will come, I don’t know. I see nothing that indicates any kind of a double dip.”

Even so, he says President Obama can’t be happy with this morning’s report from the Labor Department that payrolls increased by just 18,000 in June as the unemployment rate increased to 9.2 percent.

“It means that we’re still a ways off from getting to where we should be. We’re seeing growth around the world, but it’s not mushrooming.”

Buffett repeated his belief that once the residential construction rebounds, “We will come back big time on employment.”

He’s predicting a decline to an unemployment rate of 6 percent “within a few years.” http://ca.finance.yahoo.com/news/Despite-Jobs-Disappointment-cnbc-2407490113.html 

Leave a Reply

Your email address will not be published. Required fields are marked *