5 May 2012

Jobs growth stalls in USA, unemployed give up

4:03 pm on 5 May 2012

New figures show the jobless rate has dropped to 8.1%, its lowest rate in three years.

It's good news for Mr Obama as he officially begins his re-election campaign.

But some analysts are predicting that his economic recovery will run out of steam.

The monthly jobs report for April was disappointing, showing that American employers only added 115,000 jobs.

It was the smallest increase in months and below market expectations.

Though much of the slight fall in the US unemployment rate to 8.1% was only because of the number of Americans who gave up looking for work, the White House argues the US economy is continuing to heal.

"There's still a lot of folks out of work which means that we've got to do more," US president Barack Obama said.

"If we're going to recover all of the jobs that we lost in the recession, and if we're going to build a secure economy that strengthens a middle class, we're going to have to do more."

But presumptive Republican nominee Mitt Romney called the monthly jobs report a "terrible" result.

"The reason it dropped from 8.2 to 8.1, was not because we created a lot of jobs, as a matter of fact only 115,000. It should have been in the hundreds of thousands but it wasn't," he said.

"The reason the rate came down is because 340,000 dropped out of the workforce."

Economists warn earlier optimism about a turnaround in unemployment is now fading.

US stocks plummeted after the release of the data for April, with tech giants leading the way on fears that consumer spending would weaken.