WASHINGTON — A third consecutive anemic monthly jobs report Friday from the Labor Department signals trouble for the U.S. economy.
Employers added a weaker-than-expected 80,000 jobs in June and the unemployment rate held steady at 8.2 percent, the Bureau of Labor Statistics said.
Consensus economic forecasts had called for growth of 100,000 jobs or higher for the month, given that previous months were thought to have been skewed by weather trends, bad news out of Europe about its debt crisis and statistical adjustments.
Adding to the expectations, a closely watched gauge of private-sector hiring had suggested a day earlier that 176,000 jobs were created in June, setting the bar high for the official government report.
Instead, June looked a lot like May and April, and the three months together combined for a weak quarter in which job growth averaged about 76,000 a month, compared with 226,000 during the first three months of the year.
Since most economists have been forecasting a slower second half of 2012 because of electioneering and a congressional fight over extending expiring tax cuts, there’s little momentum heading into an anticipated rough patch.
And that could prove to be bad news for the president’s hopes for another four years in office.
“In the end, these presidential elections tend to be a referendum on the incumbent president,” said Sarah Binder, a political science professor at George Washington University.
“The bulk of voters’ decisions come down to the state of the national economy.”
The sluggish growth in American jobs comes at a time when the global economy is also losing pace. U.S. investors on Friday abandoned stocks as the Dow Jones industrial average fell 124.20 points. The loss wiped out the Dow’s gain for the week.
The job of defending the weak numbers fell to Alan Krueger, the head of the White House Council of Economic Advisers.
“The economy has now added private-sector jobs for 28 straight months,” he said in a subdued statement.
“Employment is growing, but it is not growing fast enough given the jobs deficit caused by the deep recession.”
The harsh truth for the White House is this: The average of 76,000 jobs over the past three months amounts to about half the 150,000 monthly new jobs that economists think are necessary to take into account new entrants into the workforce and still knock down the jobless rate.
“The good news is that employment growth is not slowing further, but there is no sign of it picking up either. At this pace, job creation is not fast enough to lower the unemployment rate with the labor force growing at close to 150,000 per month on average,” New York forecaster RDQ Economics said in a research note for investors.
Although weak, the numbers don’t point to a slide back into worse times.
“If the economy were tipping into recession, you would not expect to see the workweek edging higher, temporary jobs rising slightly faster and hourly earnings rising more quickly – all of which happened in June,” Nigel Gault, the chief U.S. economist for forecaster IHS Global Insight, wrote in a research note. “But firms are being very careful about adding new full-time employees. Uncertainties over the strength of global growth, the eurozone crisis, the fiscal cliff and the November elections are giving plenty of reasons for caution.”