BlackRock Expert: Jobs Data is ‘Last Nail in the Coffin’ of Economic Recovery

Friday, 03 Jun 2011 11:08 AM
By Dan Weil

U.S. May employment numbers came out disappointingly weak Friday, leading Goldman Sachs and others to question the sustainability of the economic rebound.

Non-farm payrolls rose a paltry 54,000 last month, vastly undershooting economists’ forecasts of a 165,000 increase. And April’s gain was revised downward to 232,000. The unemployment rate unexpectedly ticked up to 9.1 percent in May from 9 percent a month earlier.

Clearly the labor market is in a precarious state.

These numbers represent a major setback, and they can’t be blamed on temporary woes in the auto sector caused by Japan’s natural disaster, Goldman wrote in a commentary.

And Goldman economists aren’t the only ones in a pessimistic mood.

“This to me is a rational correction in stocks given that economic growth will slow over the next few quarters,â€