U.S. economy appears weaker ahead of jobs report

June 1, 2012

The U.S. economy is looking slightly weaker one day before a critical report on May job growth.

Economic growth was a little slower in the first three months of the year than first estimated, largely because governments and consumers spent less and businesses restocked their supplies more slowly.

The number of people who applied for unemployment benefits rose to a five-week high last week. And a survey of private companies showed only modest hiring gains last month.

Still, a softer job market hasn't caused Americans to scale back spending. Consumers spent more at retail stores in May than the same month last year, buying more clothes and Mother's Day gifts.

The mostly disappointing data sent stocks lower, keeping the Dow Jones Industrial Average on pace to record its first monthly loss since September. The yield on the 10-year Treasury note sank to 1.57 percent, a 66-year low.

The data showed that:

-- The U.S. economy grew at an annual rate of 1.9 percent in the first three months of the year, the Commerce Department said in its second estimate of January-March growth. That's lower than its initial estimate of 2.2 percent.

-- Weekly applications for unemployment aid rose 10,000 to a seasonally adjusted 383,000, the Labor Department said.

-- Private businesses added 133,000 jobs last month, according to a survey by payroll provider ADP. That figure disappointed most economists, who had hoped to see job growth accelerate after ADP's survey found that just 113,000 jobs were added in April.

Peter Newland, an economist at Barclays Research, said he was discouraged by the slowdown in first-quarter growth.

"This report does little to change the perception of an economy ticking along at a moderate pace but failing to break out into a full-on recovery with consistently above-potential growth," Newland said.

When the government issues its report Friday on May employment, economists expect it to say that employers added 158,000 jobs. That would be better than in the past two months but far below the winter's pace of 252,000 jobs per month. They also expect no change in the unemployment rate, which was 8.1 percent in April.

Surveys show the economy is the top issue on voters' minds. Weaker growth and only modest job gains could give momentum to Mitt Romney, the Republican presidential challenger. Romney has made President Barack Obama's handling of the economy the central theme in his campaign.

FINISH


blog comments powered by Disqus

Texas patient being evaluated for possible Ebola infection

September 29, 2014  10:34 PM

"Possible Ebola case would be the 1st diagnosed in USA."

Lieutenant governor candidate calls #StandWithTexasWomen mob 'anarchists' in debate

September 29, 2014  10:19 PM

Dan Patrick enraged the tampon-throwing protesters.

Man indicted for threats to 'rape, bomb and decapitate' SIU students

September 29, 2014  09:20 PM

"21-year-old Derrick Dawon Burns is accused of making the threats."

Obamaphone use increases 100 fold in Maryland; Fraud rampant

September 29, 2014  08:44 PM

"That's 100 fold increase (not 100%) 100 TIMES increase."

'Dear Bestie': Ace of Spades gives desperate Dems a taste of their own creepy medicine

September 29, 2014  08:21 PM

"Please send me $50 in 'friendship money.'"

FSM Archives

More in PUBLICATIONS ( 1 OF 25 ARTICLES )