Unemployment Rises to 8.2 Percent in May

(Newsroom America) -- In what can't be perceived as good news by the White House, especially in a hotly contested election year with voters laser-focused on the economy, unemployment ticked upward in May to 8.2 percent, up a tenth of a percent from the previous month.

Last month's growth was the weakest in a year, as employers only created a miniscule 69,000 jobs, the Labor Department said.

Reuters said economists it polled estimated an increase of non-farm payrolls to be about 150,000.

The uptick is being blamed on a number of factors, not the least of which is a flood of new job-seekers into the labor pool. But economists also point to the worsening debt crisis in Europe and China's cooling manufacturing sector, which was sluggish in May, reports said.

"The May jobs report indicates growth could be even slower in the second quarter, and the economy is dangerously close to stalling and falling into recession," said Peter Morici, an economist at the Robert H. Smith School of Business at the University of Maryland.

"The economic crisis in Europe and mounting problems in China's housing and banking sectors continue to instigate worries among U.S. businesses about a second major recession, and these discourage new hiring," he said. "The U.S. economy continues to expand albeit moderately but is quite vulnerable to shock waves from crises in European and Asia."

An increase in the U.S. labor force also contributed to the rise in unemployment, analysts noted. Those with a job or those looking for a job increased rose to 63.8 percent of the population in May, after dropping to a 30-year low in April.

"Factoring in those discouraged adults and others working part time for lack of full time opportunities, the unemployment rate is about 14.8 percent. Adding college graduates in low skill positions, like counterwork at Starbucks, and the unemployment rate is likely closer to 18 percent," Morici said, adding that economic "growth in the range of 4 to 5 percent is needed to get unemployment down to 6 percent over the next several years."

Stocks opened sharply lower on the Labor Department figures, with the Dow tumbling 164 points early on, accompanied by a 40-point drop in Nasdaq by mid-morning.

The gloomy employment and economic picture is likely to provide additional fodder for presumptive GOP presidential nominee Mitt Romney, who has made turning the economy around a centerpiece of his campaign to unseat President Obama.

From the campaign trail, Romney called the May jobs report "devastating," blaming Obama's economic policies for sustained high unemployment rates.

"Today's weak jobs report is devastating news for American workers and American families," Romney said in a statement.

"It is now clear to everyone that President Obama's policies have failed to achieve their goals and that the Obama economy is crushing America's middle class," he said. "The president's re-election slogan may be '€˜forward,' but it seems like we've been moving backward."

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