Economists are growing pessimistic about prospects for the U.S. economy following a lousy May jobs report. (It is the dismal science, after all.)
The unemployment rate rose to 8.2% last month, while employers added just 69,000 jobs. Here's what some economists are saying about it.
Nigel Gault, chief U.S. economist, IHS Global Insight: "2012 is beginning to look horribly like 2011 – initial high hopes that the recovery was kicking into high gear, subsequently dashed.... There's clearly less momentum than [Federal Reserve] participants had anticipated. For that reason we expect that the Fed will probably try to keep pumping in stimulus in some form in the second half of the year."
Peter Morici, economist at the Smith School of Business, University of Maryland: "Factoring in those discouraged adults and others working part time for lack of full-time opportunities, the unemployment rate is about 14.8%. Adding college graduates in low-skill positions, like counterwork at Starbucks, and the unemployment rate is likely closer to 18%. Prospects for lowering those dreadful statistics remain slim. The economy must add 13 million jobs over the next three years -- 362,000 each month -- to bring unemployment down to 6%."
Heidi Shierholz, economist at the Economic Policy Institute: "Payroll employment growth is nowhere near strong enough to get us to full employment anytime soon.... The labor market still has a deficit of close to 10 million jobs, and the lack of demand for workers means unemployment remains high and wage growth for people with jobs remains low."
Sung Won Sohn, professor of economics at Cal State Channel Islands: "Spring is turning into winter again. Businesses are showing a high degree of caution in hiring people. There are a number of reasons for the cautiousness. For businesses, Washington is a major source of uncertainty sapping business confidence. The impending fiscal cliff is the biggest roadblock to hiring at the moment. Obama and the Congress should reach a compromise eliminating the big source of uncertainty as soon as possible. Otherwise, uncertainties will build during this election year, hurting the economy and jobs."
Robert A. Dye, chief economist at Comerica: "In a weak job market there is a limit to how far consumers will lean over their skis before they have to pull back, setting up a weak third quarter unless job creation reaccelerates."
Chad Moutray, chief economist at the National Assn. of Manufacturers: "This is another disappointing labor report, which is consistent with recent weaknesses we’ve seen in the global and domestic marketplace. Several other recent economic indicators have shown growth easing in the spring months. Both manufacturers and consumers are anxious about Europe and uncertain about long-term tax policies."
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