U.S. hiring seen stuck in low gear in June

Fri Jul 6, 2012 12:24am EDT
 
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By Jason Lange

WASHINGTON (Reuters) - U.S. employers likely quickened the pace of hiring last month but not enough to allay worries that Europe's debt crisis is shifting the economy into low gear.

The Labor Department is expected to say on Friday that non-farm payrolls expanded by just 90,000 jobs in June, according to a Reuters survey of economists.

That would be stronger than May's increase of 69,000 jobs but still tightens the vise on President Barack Obama's re-election bid before the November vote.

"There's just not a lot of momentum in the economy," said Sam Bullard, an economist at Wells Fargo & Co in Charlotte, North Carolina.

Mitt Romney, Obama's Republican challenger, is focusing his campaign on the weak jobs market that has dogged Obama's presidency.

Most economists believe job creation in June was too weak to bring down the lofty 8.2 percent unemployment rate. That might push the Federal Reserve closer to taking new actions to lower borrowing costs to encourage companies to increase hiring.

Debt woes have bogged down much of Europe, sending some countries into recession. The euro zone crisis in turn has dulled economic growth around the world from China to Brazil. A survey on Monday found U.S. manufacturing contracted for the first time in nearly three years in June.

Europe is not the only worry weighing on the U.S. outlook. Washington plans enough belt-tightening at the start of 2013 to easily send the economy into recession. Cautious observers wonder if lawmakers can avoid this "fiscal cliff."   Continued...

 
People wait in line to be processed during a summer city employment event in New York June 4, 2012. REUTERS/Eric Thayer