Job Spectrum

US employment growth slowed stridently in May, with only 54,000 net new jobs added in the course of the month. Markets had anticipated an increase of 150,000. It follows a downwardly changed but still rapid 232,000 rise in April. In spite of the downturn, it was the 8th month in a row of constructive employment growth, based on data from the US Labor Department.

The unemployment rate also climbed unpredictably to 9.1 percent, from 9 percent a month before. The number of unemployed remained mainly unaffected at 13.9mn, but the number out of work for more than twenty six weeks rose by 361,000 to 6.2mn. Local governments condensed their headcount for the 22nd month in a row, by a bizarrely large 28,000.

The numbers ultimately disappointing US economy based on the data released in the last week, including noticeable slowdowns in the manufacturing segment and in consumer spending. It all points to a noticeable slowdown in the US market during the 2nd quarter of the year, based on the Nigel Gault, head US economist at IHS Global Insight.

Nevertheless, he remains positive about the prospect for the 2nd half of the year: "We’ve seen some easing in gasoline and commodity costs, which are starting to come down, and the bad effects on automobile production of the Japanese problems will begin to unwind." But the numbers might revivify fears of a likely slide back into recession, forecasters warn. The Dow Jones plummeted 1.2 percent at the beginning of trading, prior to recovering during morning trading in New York.