U.S. hiring slowed to a near-standstill in May, sowing doubts about the economy’s health and complicating the Federal Reserve’s efforts to raise interest rates.
While unemployment slid from 5 percent to 4.7 percent, the lowest since November 2007, the rate fell for a troubling reason: Nearly a half-million jobless Americans stopped looking for work and so were no longer counted as unemployed.
Employers added just 38,000 jobs in May, the fewest in over five years.
Less-educated workers bore the brunt of the hiring slump, with a quarter-million high school dropouts losing their jobs in May. That has perpetuated a long-term trend toward a two-tiered job market, with college-educated adults more likely to be employed and earning steady raises.
“The shockingly low payrolls gain in May provides further evidence that the economy is showing clear signs of slowing,” said Laura Rosner, an economist at BNP Paribas.
The much-weaker-than-expected figure raised doubts that the Federal Reserve will increase short-term interest rates at its next meeting in mid-June or perhaps even at its subsequent meeting in July. Many analysts had expected an increase by July.
On Wall Street, the Dow Jones industrial average closed down 32 points, for a loss of 0.2 percent.
The disappointing report spilled into the presidential race, with Donald Trump referring to it on Twitter as a “terrible jobs report” and a “bombshell.” The figures come just days after President Barack Obama touted his economic record in Elkhart, Indiana.
Americans particularly worried about the economy have been more likely to support outsider candidates such as Trump and Democratic Sen. Bernie Sanders.
Trump’s support has also come disproportionately from adults without college degrees, and Friday’s report served as a stark reminder that less-educated Americans have continued to lose economic ground even as overall hiring and growth have picked up since the Great Recession.
Essentially all of the 7 million jobs added over the past decade belong to workers with at least some college experience. The number of high school graduates with jobs is 3 million lower than 10 years ago.
“The high school jobs are gone and they’re not coming back,” said Anthony Carnevale, director of the Georgetown University Center on Education and Workforce. “It’s driven by a fundamental shift from an industrial economy to a post-industrial economy.”
Craig Lloyd, 27, has mostly worked part-time jobs in restaurants in Wichita, Kansas, since graduating from high school 10 years ago. Some paid as little as minimum wage, while his most recent position as a sous-chef paid $12 an hour.
Three months ago, he started his own business selling burritos out of a friend’s food truck on weekends.
His wife is returning to school to get her degree, but he doesn’t plan to do so himself. “I’ve really put off getting a higher education, because of the debt that you can incur,” Lloyd said.
http://www.wistv.com/story/32131515/us-hiring-grinds-to-a-near-halt-many-stop-looking-for-workObama: America is not in decline, Trump lacks ‘magic wand’ to grow economy (June 1, 2016)ELKHART, Ind. — President Obama defended his economic record on Wednesday during a visit to an Indiana city that has come to symbolize the nation’s uneven recovery, saying that he created millions of new jobs and questioning Republican Donald Trump’s ability to steer the economy in the right direction.
In a far-ranging interview and town-hall event with PBS NewsHour in Elkhart, Obama touted the economic gains seen under his watch in hard-hit counties like Elkhart, where the unemployment rate soared to nearly 20 percent soon after he took office.
Unemployment in the county, which the Obama administration used as a touchstone early on to gauge its economic recovery plan, now stands at roughly four percent.
“We’re going to have to make sure that we make some good decisions going forward, but the notion that somehow America is in decline is just not born out by the facts.”
“We’re going to have to make sure that we make some good decisions going forward, but the notion that somehow America is in decline is just not born out by the facts,” Obama said in an interview with the NewsHour’s Gwen Ifill.
Nevertheless, in the interview and a town hall held immediately after in downtown Elkhart, the president acknowledged that many people around the country remain worried about making ends meet.
“Even though we’ve recovered, people feel like the ground under their feet isn’t quite as solid,” Obama said. “If they’re feeling insecure, and they’re offered a simple reason to be more secure, people are going to be tempted by it.”
The comment was clearly aimed at Donald Trump, the presumptive Republican nominee. Trump’s populist economic message has energized millions of voters, but his critics — including Obama and former Secretary of State Hillary Clinton, the likely Democratic nominee — have long argued that Trump does not have the experience or gravity to lead the country.
The president declined to invoke the real estate mogul’s full name, saying that he would let Trump “do his advertising for him.”
But Obama criticized Trump’s claims that he could use his business acumen to spur economic growth and tackle other complex issues.
“He just says, ‘I’m gonna negotiate a better deal.’ Well how? How exactly are you going to negotiate that?” Obama said during the town hall portion of the event. “What magic wand do you have? And usually the answer is, he doesn’t have an answer.”
http://www.pbs.org/newshour/updates/watch-live-president-obamas-town-hall-in-elkhart-indiana/---------------------------------------------------------
It will be very hard for historians to clean up 0bama's records.
