The pace of US hiring slumped sharply in June after several months of robust gains, the government reported today, as employers added fewer than half the number of payroll jobs forecast and hours of work shrank.
The Labour Department said only 112,000 jobs were created last month, far fewer than the 250,000 that Wall Street analysts had anticipated. April and May new-job totals were revised down, to 324,000 and 235,000 respectively, from 346,000 and 248,000.
The unemployment rate was unchanged, as expected, at 5.6 per cent. June still represented a 10th straight month of job growth that has added about 1.5 million workers to payrolls, but the unexpectedly steep slowdown last month may make it harder for President George W. Bush to campaign for re-election in November on a claim of accelerating economic momentum.
In a sign of broader weakness, the average work week eased to 33.6 hours in June from 33.8 in May, the shortest since a matching level in December.
All of June's job growth in service industries. The manufacturing sector lost 11,000 jobs, a reversal after four straight months in which factories had added jobs following years of decline.
Bond prices jumped in the wake of the data, because investors are likely to believe the economy is not as strong as they had thought in recent weeks. Stocks appeared set to open lower, likely because of worry that the corporate profits picture may not be as bright as thought.
The dollar lost value against other global currencies immediately after the jobs report.
Analysts said the jobs report was a shock but held off judgment on whether it signaled an impending broader slowdown.