The U.S. economy is facing a grim reality: a renewed spike in unemployment just as most avenues for fiscal and monetary stimulus appear maxed out.
The Federal Reserve, which injected trillions of dollars into the economy to support the recovery, is highly reluctant to embark on a third round of bond purchases. Congress, meanwhile, is debating heavy spending cuts, not employment programs.
May's employment figures were almost unequivocally dismal, cutting across sectors, and defying easy explanations due to one-time factors.
Here are some of the worrisome details:
• The economy created a paltry 54,000 jobs in May, compared to a downwardly revised 232,000 in April. Economists had been looking for a 150,000 increase.
• The unemployment rate rose to 9.1 percent from 9.0 percent as some discouraged workers reentered the labor force. Wall Street economists had been looking for a drop to 8.9 percent.
• Manufacturing employment contracted for the first time since October, and the loss of government jobs accelerated to 29,000.
• Temporary work, a category often viewed as a harbinger of better hiring, shrank for a third month in a row.
• The report comes as developments overseas have also made for a more uncertain business environment. Europe's debt crisis continues to rage on at a high social cost for countries such as Greece, Portugal and Ireland.
• At the same time, social unrest around the Middle East and North Africa as a string of countries takes cues from democratic uprisings in Tunisia and Egypt have made the future even more difficult to predict. Oil prices shot sharply higher earlier this year on the unrest.
• This uncertainty is boosting volatility in financial markets and punishing consumers with higher energy and commodity costs, even if these have been easing over the last couple of weeks.
• Even as the jobs report was released, it was reported that the presidential palace in Yemen had been attacked, and that its president Ali Abdullah Saleh might have been injured.
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