[Via Communist Internet... http://www.egroups.com/group/Communist-Internet ] . . ----- Original Message ----- From: <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]>; <[EMAIL PROTECTED]>; <[EMAIL PROTECTED]> Sent: Sunday, July 08, 2001 5:24 PM Subject: Got Job Security? U.S. payrolls fall sharply in June [WWW.STOPNATO.ORG.UK] STOP NATO: NO PASARAN! - HTTP://WWW.STOPNATO.ORG.UK --------------------------- ListBot Sponsor -------------------------- Start Your Own FREE Email List at http://www.listbot.com/links/joinlb ---------------------------------------------------------------------- [FYI New Jobs in Utah are $5.15 to $8.00 an hour.] "Inflation pressures appeared to be relatively muted as workers' wages grew 0.3 percent to $14.29 an hour in June from $14.25 in May." Want to send this story to another AOL member? Click on the heart at the top of this window. U.S. payrolls fall sharply in June By Mark Egan WASHINGTON, July 6 (Reuters) - The U.S. jobless rate edged up in June and job losses mounted as weakness spread to the service sector of the economy, the government said on Friday in a report that cast a shadow on other recent upbeat data. The Labor Department's employment report for June portrayed a weaker jobs market than many had expected as 114,000 nonfarm jobs were lost and the jobless rate ticked higher to 4.5 percent from 4.4 percent in May. Economists polled by Reuters had expected 44,000 job losses in June and the jobless rate to rise to 4.6 percent. The closely watched report showed average hours worked per week remained steady in June at 34.3 hours. Inflation pressures appeared to be relatively muted as workers' wages grew 0.3 percent to $14.29 an hour in June from $14.25 in May. The report revised employment data for May to show that 8,000 jobs were added outside the farm sector that month, a big improvement from the 19,000 job losses recorded when the May figures were issued last month. Labor also said that the economy shed 165,000 jobs in April, better than the previously reported 182,000 job cuts. For the second quarter, a total of 271,000 jobs were lost. While on the face of it the report seemed broadly negative, many economists took solace from other recent positive data -- improvements in weekly jobless claims, firmness in the housing market, improving consumer confidence and orders for durable goods -- as harbingers that the slowdown may have hit bottom. AN ABERRATION "This does not derail the outlook for the economy to recover during the second half of the year," said Bill Cheney, chief economist at John Hancock Financial Services. "It seems to me that this is probably an aberration," Cheney said, adding that other recent data point to an improving economy in the months ahead. Still, economists said the smaller-than-expected rise in the unemployment rate was more due to disheartened workers leaving the labor force, which tends to hold the rate down, than to any resilience in the economy. They cited the average hours worked data as a sign growth is anemic. Most economists expect the U.S. Federal Reserve to cut interest rates again when it next meets in August -- an expectation bolstered by the jobs data. The powerful central bank has cut rates six times this year, by a total of 2.75 percentage points, and has indicated it is prepared to do more should the economy deteriorate further. U.S. Treasuries were little moved by the data but stocks had a bruising day, weighed by signs that the economy was still struggling and corporate profit warnings. The Dow Jones Industrial Average closed 2.17 percent lower while the technology-laden Nasdaq index shed 3.65 percent on the day. Economists see a rise in job losses as a risk to economic recovery as higher unemployment tends to sap consumer confidence and could lead to lower spending. But at 4.5 percent, the jobless rate is still low by historical standards. Most observers expect the effect of lower interest rates -- which economists estimate can take six to 18 months to fully impact the economy -- and lower taxes to help buoy economic activity in the second half of the year. NOT OVER YET? But not everyone was upbeat about the data, with some pointing to the fact that the manufacturing sector has shed 785,000 workers between August of last year and June. Perhaps the most worrisome aspect of the report was that the weakness in manufacturing seemed to have spread to the service segment of the economy, which has countered softness elsewhere in recent months. With fewer goods being produced, the factory slump appeared to take a toll on related fields such as transportation, where employment fell by 11,000 in June and wholesale trade where 15,000 positions were lost during the month. "The slowdown isn't behind us just yet," said Joel Naroff, president of Naroff Economic Advisors, adding that a few more months of steep job losses could lead to a recession, commonly defined as at least two quarter of economic contraction. "It's hard to really determine when the manufacturing sector will get its act together and until it does, we will have more problems," Naroff said. June proved another bruising month for manufacturing, with 113,000 jobs shed after a loss of 127,000 in May -- taking consecutive months of job losses in that area of the economy to 11. But economists said the trend in the sector appears to be bottoming out. The service-producing sector, which has been the driving force behind much of the U.S. economic expansion in recent years, added a paltry 5,000 jobs. That compared to 97,000 new jobs in May and marked the worst performance in the sector since 15,000 jobs were shed in August of last year. Nevertheless, many economists will wait to see if that weakness becomes a trend before becoming overly concerned about one slack month. A separate report on the outlook for U.S. inflation from the Economic Cycle Research Institute showed inflation looked set to decline in the months ahead. 16:41 07-06-01 Copyright 2001 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. 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