Jobless Rate Rises to 9.1%

The Wall Street Journal reports:

U.S. hiring slowed dramatically in May and the unemployment rate kept rising, adding to concerns the jobs market will take years to heal as the economy remains weak.

Nonfarm payrolls rose by 54,000 last month as the private sector posted the smallest jobs gain in nearly a year, the Labor Department said Friday in its survey of employers. Payrolls data for the previous two months were revised down by a total 39,000 to show increases of 232,000 jobs in April and 194,000 in March.

The jobless rate, which is obtained from a separate household survey, unexpectedly rose to 9.1% in May from 9.0% in April. There are almost 13.9 million Americans who would like to work but can't get a job.

Economists surveyed by Dow Jones Newswires had forecast payrolls would rise by 160,000 and the jobless rate would edge lower to 8.9%.

Even though the recession ended two years ago, the pace of economic growth has been too slow to make up for the ground lost following the financial crisis of 2008 and 2009. Recent signs point to more economic weakness ahead. The manufacturing sector, once the driver of the recovery, in May posted its biggest monthly drop since 1984.

Friday's report showed private-sector employers, which account for about 70% of the work force, added 83,000 jobs in May, the smallest gain since June 2010. That compares with increases of 251,000 in April and 219,000 in March.

The breakdown from the employers survey showed manufacturing employment declined for the first time since October 2010. Supply disruptions following Japan's earthquake are expected to have weighed on the sector, which could find its footing later in the year.