Unemployment Rate Jumps to Six Percent
The jobless rate increased by .3 percent from 5.7 percent in March, even though U.S. companies expanded their payrolls for the first time in nine months, creating 43,000 new jobs.
The manufacturing and construction sectors reflected the largest employment losses, losing 19,000 and 79,000 positions respectively.
The services sector, however, reported an increase of 87,000 jobs, the first signs of recovery in an industry that shed hundreds of thousands of positions as businesses struggled to recover from last year’s recession and the Sept. 11 attacks.
The creation of new jobs was not large enough to offset the increasing number of jobless claims, as the labor market has yet to catch up with the gradual economic recovery.
“In some measures, while today’s jump was higher than the private forecasters expected, it is not out of the usual as a part of a recovery,” White House spokesman Ari Fleischer told reporters Friday. “The White House believes that as the economy recovers, business investment, which fuels hiring of new workers, will lag other segments of the economy and not revive until later in the year.”
The Federal Reserve is expected to consider the lagging job market when it meets next Tuesday to discuss interest rates, currently at a 40-year low.
On Wall Street, stocks prices fell Friday morning on the news of a weaker job market, with the Dow Jones industrial average falling over 100 points and the Nasdaq dropping about 30 points.