Unemployment Rate Rises to 9.1%

Employers hired only 54,000 new workers in May, the fewest in eight months, and the unemployment rate rose to 9.1%. The Labor Department report offers startling evidence that the US economy is slowing, hampered by high gas prices and natural disasters in Japan that have hurt US manufacturers. The Wall Street Journal notes that 160,000 jobs were expected to be created and the unemployment rate was expected to fall to 8.9%. But more people entered the work force last month, which pushed the unemployment rate up from 9.0% in April.

The pace of hiring has slowed sharply from the previous three months, when the economy added an average of 220,000 new jobs. Private companies hired only 83,000 new workers in May—the fewest in nearly a year. Local governments cut 28,000 jobs last month, the most since November. They have cut jobs for 22 straight months. (More unemployment stories.)