US Payrolls a Big Disappointment

Employers in the U.S. hired fewer workers than forecast in June, showing the labor market is making scant progress toward reducing joblessness.

Payrolls rose 80,000 last month after a 77,000 increase in May, Labor Department figures showed today in Washington. Economists projected a 100,000 gain, according to the median estimate in a Bloomberg News survey. The unemployment rate held at 8.2 percent. Private employment, which excludes government agencies, increased 84,000 in June, the weakest in 10 months.

Hiring has shifted into a lower gear, restricting consumers’ ability to boost spending as concern mounts about a global slowdown. Elevated joblessness underscores concern by some Federal Reserve policy makers that the economy isn’t expanding enough.

“The labor market isn’t making the grade,” Jonathan Basile, director of U.S. economics at Credit Suisse in New York, said before the report. “This is not the rate of job creation that would be desired when you still have so many jobs to fill. There’s a high hurdle for firms to ramp up their hiring.”

Estimates for total payrolls from the 84 economists surveyed ranged from increases of 35,000 to 165,000 after a previously reported 69,000 gain in May.

Revisions to prior reports subtracted a total of 1,000 jobs to payrolls in the prior two months.

Private payrolls, which exclude government agencies, climbed after a revised gain of 105,000 that was larger than initially reported. They were projected to advance by 106,000 in June, the survey showed. The June figure concluded the worst quarter for corporate hiring since the first three months of 2010.

Bloomberg

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