US Creates 69,000 New Jobs, 158K forecasted; Unemployment Rate 8.2%

by 01 Jun 2012

(CNBC) -- The American jobs engine hit stall speed in May, with the economy adding just 69,000 new jobs while the unemployment rate climbed to 8.2 percent.

As another summertime swoon looms, the Bureau of Labor Statistics reported that job creation missed economist estimates for 158,000 new positions and the jobless rate rose for the first time in nearly a year.

Labor force participation remains near 30-year lows though incrementally better than last month, rising to 63.8 percent.

The unemployment rate that counts discouraged workers rose as well, swelling to 14.8 percent form 14.5 percent in April.

Long-term unemployment also took a sharp upturn, with the number of those out of work for 27 weeks or more jumping from 5.1 million to 5.4 million. The average duration of unemployment moved from 39.1 weeks to 39.7 weeks.

"It's painfully obvious the economic recovery in the U.S. isn't just slowing down, it's pulling up the emergency brake. And, lack of job creation isn't the only critical concern. Wages/Income is sharply lower," said Todd Schoenberger, managing principal The BlackBay Group in New York.

"For those lucky enough to have a job, their spending power is sliding when accounting for inflation. The markets will respond negatively to this report," he added.

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