US payrolls down, private hiring below forecasts

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US payrolls down, private hiring below forecasts

US payrolls down, private hiring below forecasts
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The number of people in work in the US fell in June for the first time this year with payrolls dropping by 125,000.

However the figures were distorted last month by the hiring of thousands of temporary government workers to carry out the US census survey.

Private hiring was up, but by less than economists had expected.

The overall jobless rate fell to 9.5 percent, the lowest level since July last year, but that was due to people giving up on finding work and leaving the labour force.

The report adds to worries that the recovery could be faltering.

Stubbornly high unemployment means US households have been less keen to spend in recent months, threatening to create a vicious cycle that could tip the economy back into recession.

President Barack Obama has called job creation his No. 1 priority. Responding to the figures he said: “Make no mistake, we are headed in the right direction.”

But Obama added: “We’re not headed there fast enough for a lot of Americans.”

He told reporters: “We continue to fight headwinds from volatile global markets, so we still have a great deal of work to do to repair the economy and get the American people back to work.”

Public unhappiness with the speed of the economic recovery is eroding President Obama’s popularity.