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Weak jobs report fuels criticism, may hurt Obama’s campaign

Sluggish growth draws fire from GOP

The Foothill Employment and Training Connection posted fliers about jobs on their board. The unemployment rate remained at 8.2 percent in June, and 80,000 jobs were created.
The Foothill Employment and Training Connection posted fliers about jobs on their board. The unemployment rate remained at 8.2 percent in June, and 80,000 jobs were created.Kevork Djansezian/Getty Images

US employers added only 80,000 jobs in June, the third straight month of weak hiring and a potential setback for the campaign to reelect President Obama, who on Friday called on voters to take a long view of the slowly recovering economy, but was slammed by rivals for the persistently dismal jobs numbers.

Job creation has slowed since the beginning of the year, the Labor Department said Friday, with a monthly average of just 75,000 new jobs added from April through June, one-third of the pace in the first three months of the year. The nation's unemployment rate remained 8.2 percent in June, unchanged from the previous month.


"Employers are obviously very reluctant to add employees," said Nigel Gault, chief US economist with IHS Global Insight in Lexington.

Concern about the economy in Europe, a vital market for US companies, was probably the number one reason for the uncertainty, Gault said, "because it has the potential to get a lot worse very quickly." Recent moves by China's central bank are also causing concern that the country's leaders are anticipating a sharp economic downturn there.

The stubbornly sluggish economy and an unchanging unemployment rate continue to provide fuel for Republican nominee Mitt Romney's presidential campaign. Republicans immediately criticized Obama after jobs numbers were released Friday, saying he has not done nearly enough to get the ailing economy back on track.

"This kick in the gut has got to end," Romney said in a hastily staged press conference near his vacation home in Wolfeboro, N.H.

Obama argued the economy was getting back on track — it just needed more time to get moving. "It's still tough out there," he said while campaigning in Pennsylvania and Ohio, two key swing states that are vital for his reelection chances. Overall, there have been 4.4 million jobs created over the past 28 months, he added. "That's a step in the right direction," Obama said. "But we can't be satisfied."


Although there will be four more monthly jobs reports before the election in November, past trends suggest voters' impressions about the economy — and the way it has been handled by the incumbent — tend to solidify by late in the summer, analysts said.

Christopher Wlezien, a professor of political science at Temple University who has studied the effect of the economy on presidential elections, said job creation could become an important factor in establishing the mood of the electorate. The June jobs report "is not good news for the president, but it doesn't seem to be devastating news," he said. "The slope of the economy in the coming four months — that's really going to be critical."

The total number of unemployed people in the United States remained at 12.7 million in June; 5.4 million of those were long-term unemployed, meaning they have been out of work for more than 27 weeks.

Monthly job growth below 100,000 makes it extremely difficult for a president to win reelection, said Mark Zandi, chief economist at Moody's Analytics and a 2008 economic adviser to presidential contender John McCain. "Right now it's a headwind, but it's blowing very modestly," Zandi said. "But if we don't improve, it's going to start blowing really hard."

On Friday, US financial markets sank in response to the employment numbers, with the Dow Jones industrial average closing down 124 points, or just under 1 percent.


Professional and business services led all sectors in June hiring, with 47,000 jobs created. Leisure and hospitality added 13,000. Manufacturers added 11,000 jobs, while retailers cut 5,400 positions. Only 2,000 jobs were created in education and health services — both strong sectors in Massachusetts. The federal government chopped 7,000 jobs, states cut 1,000, and localities added 4,000.

The construction industry added just 2,000 positions in June. Mark Erlich, executive secretary of the New England Regional Council of Carpenters, said he is not surprised that construction employment is still lagging.

"We're starting to climb out of the construction depression that happened around 2008, but there's a considerable gap between the ribbon-cutting and boots on the ground," he said.

So far, Massachusetts has been able to dodge the worst of the nation's economic doldrums. The state's unemployment rate in May fell to 6 percent, its lowest level in more than three years, as Massachusetts employers added jobs for the sixth consecutive month, the Executive Office of Labor and Workforce Development reported last month. The state's June unemployment numbers are due out in a few weeks.

Although Friday's national jobs report was "more of the same: slow growth," there was a bright spot in temporary employment, which was up over May, said Alan Clayton-Matthews, an economist at Northeastern University. "Temporary employment is a sector that usually responds first when things are picking up," he said. "It shows that employers would like to hire, but they are not confident enough to bring on full-time workers."


Stuart Coleman, a general manager with the Winter, Wyman Financial Contracting division in Waltham, which places temporary, contract employees, said he has noticed a rise in temporary hires.

"It felt like things were busier," he said, adding that temporary hiring during the last three months was up 13 percent over the same period a year ago. "Companies are busy enough to hire people, but they are just not sure they will have enough business a year from now to keep them on permanently."

D.C. Denison can be reached at denison@globe.com. Matt Viser can be reached at maviser@globe.com.