Reacting to a lackluster jobs report, stocks fell sharply Friday morning in a hammering that continues the fifth straight week of market losses and the longest losing streak for the Dow Jones since 2004.
Only 54,000 new nonfarm jobs were added in May, mostly in the private sector. About 365,000 a month for at least a year are needed to bring unemployment down to 6 percent, according to an estimate by Peter Morici, an economics professor at the University of Maryland.
The unemployment rate, which had been 9 percent in April, increased slightly to 9.1, as 54,000 new nonfarm jobs were added, mostly in the private sector. The continuing contraction in government hiring pulled down the overall number.
Why the stalled growth?
Robert Dye, senior economist at PNC Financial Services in Pittsburgh, points to three sets of factors:
One set is transitory: the increase in oil prices, the fallout from the tornadoes, and the supply chain bottleneck that stemmed from the Japanese tsunami.
Another set he describes as "medium-term economic drags," among them consumers who are reluctant or unable to consume and the wretched housing and commercial real estate markets.
The third is more systemic, with the effects to be felt over the decade: Population growth is slowing, he said, and at the same time, the development pace of job-replacing technology is expanding.
"There is a lot going on in the economy, piling on to keep this a half-speed recovery - a slow to moderate economy that is vulnerable to downside risk," Dye said.
Friday's report shows increased hiring in the service sector, with the strongest growth in professional and business services, especially in accounting and computer design. Employment in health and education also continued to increase.
But, in contrast to the reports issued over the last several months, nearly every other sector shows some decline. Manufacturing, which had several surprising months of growth, fell. Retail continued to drop, with the biggest fall in building material stores, reflecting slowness in the construction industry, which added a meager 2,000 jobs.
Government hiring fell by 29,000 with a staggering amount, 28,000 jobs, lost on the local government level.
That's the company side - on the human side, the situation also continues to erode. The average length of unemployment was 39.7 weeks in May, up from 38.3 weeks in April and 34.3 weeks a year ago.
The number of unemployed increased to 13.9 million, from 13.7 million and 6.2 million of them have been unemployed for more than 27 weeks.
To get those people re-employed would take an economy that was moving much more rapidly than this one is.
"Each year, the working age population increases one percent and productivity advances about two percent; hence growth in the range of three percent is necessary to keep the unemployment rate steady. Coming out of a deep recession, growth in the range of four to five percent is needed and possible to get unemployment down to 6 percent over the next several years," Morici said.
The number of jobs added marked the smallest monthly increase since September 2010.
Even so, any job expansion is good news for someone such as Vincent Tricome, a civil engineer from Chester Springs who had been out of work since July 2008, making ends meet by working at Wawa.
On May 2, Tricome rejoined a former employer for a part-time civil engineering job that he hopes will become full time.
"I have stayed in touch with many of my previous employers over the years and it has paid off," he wrote in an e-mail. In the meantime, he wrote, he's not giving up his work at Wawa.
"It seems to be sputtering along. The economy just hasn't taken off," he said. "It's still bad out there."
The decline in manufacturing hiring reported by the Labor Department Friday runs counter to a survey of area manufacturers released in May by the Delaware Valley Industrial Resource Center, an economic development organization focusing on manufacturing.
Nearly 9 in 10 area manufacturers surveyed in December, January and February said they had current job openings, and 4 in 5 said they would be adding jobs in the next 12 months. Most needed were machinists, but there were also openings for engineers, programmers and management support.