​Hiring Forecast Slows With 80,000 New Jobs

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July 12, 2012

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Hiring was slow last month, but the U.S. economy added 80,000 jobs in June, hardly an improvement over 77,000 jobs added in May and not enough to bring the unemployment rate down.

The unemployment rate remained at 8.2%. The U.S. lost 4.3 million jobs in President Obama’s first 13 months in office, according to CNN. Economists surveyed by CNNMoney had expected to see employers add 95,000 jobs and the unemployment rate to remain unchanged.

The labor market has been volatile this year, with job growth starting off strong in the first couple months of 2012. Then a disappointing slowdown in the spring led many to wonder whether the recovery was taking a turn for the worse.

Economists have attributed the strong hiring in the winter to unusually warm weather. Now they say fears about Europe’s debt crisis, China’s slowdown and fiscal cliff looming in the United States are holding employers back.

“It’s hard for an employer to hire somebody when you don’t know what the tax rates are going to be in six months. There’s just too much uncertainty,” said John Silvia, Wells Fargo chief economist.

June’s weak growth added to fears that the recovery is waning. The economy needs at least 125,000 jobs added each month just to keep up with population growth. It needs even more to bring the unemployment rate down.

Other recent reports have shown retail sales are slowing, the manufacturing sector is contracting and consumer confidence has fallen.

“Today’s report is the rotten cherry atop the half-baked economic news of the last few months,” Chris Jones, economist with TD Bank said in a note.

On the upside, the housing market seems to be improving, with both home prices and home sales rising recently. Construction companies added 2,000 jobs in June. While that’s not much, it’s still the first time since January that the economy has added construction jobs.

Revisions from previous months showed the overall economy gained 1,000 fewer jobs in April and May than originally thought.

Among the sectors adding jobs, manufacturers hired 14,000 workers, professional and business services added 47,000 jobs, and restaurants and bars added 15,100 jobs.