WASHINGTON — The nation shed 62,000 more jobs in June, bringing total losses for the year to 438,000 and rekindling concerns that the United States is in recession.
What's more, the Labor Department's unemployment report, released Thursday, showed job losses in April and May were significantly deeper than initially thought. That contraction, combined with higher gas prices, suggests weakness ahead in consumer spending, which accounts for about 70% of economic activity.
"The economy has entered a slow-motion recession," said Dean Baker, co-director of the Center for Economic and Policy Research, a Democratic-leaning think tank. "It is not seeing the dramatic plunges in jobs that characterized prior recessions, but the collapse of the housing bubble is slowly sinking more and more sectors of the economy."
The economic stimulus payments the government issued to taxpayers in the last few months have helped ease the strain of higher energy prices, but that boost is about to fizzle out, said Joel Naroff of Naroff Economic Associates in Holland, Pa.
"When people run out of rebate money for gasoline and food, they will be in trouble," Naroff said. "This tepid, limping economy will be with us for a while. We're not crashing and burning; it's just not an economy that's going anywhere."
The news could have been worse. The unemployment rate was unchanged after shooting up from 5% in April to 5.5% in May, the biggest one-month jump since 1986. And job losses were in line with expectations, contributing to a stock rally on Wall Street.
But some economists took little comfort in the flat unemployment rate. They noted that many workers have stopped looking for jobs altogether and are not being counted among the jobless because they have not actively sought new employment within the last four weeks.
"Many more adults are sitting on the sidelines, neither working nor looking for work," said Peter Morici, an economist at the University of Maryland. "Factoring in discouraged workers raises the unemployment rate to about 7.2%."
In addition to the 8.5 million Americans counted as unemployed, an additional 5.4 million were working part time because they were unable to find full-time work, the government said. About 1.6 million others were "marginally attached" to the labor market -- that is, they had looked for work sometime in the last 12 months but had become discouraged, entered school or decided to stay home to care for family.
