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Worries resurface on US recovery

Worries resurface on US recovery
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More weak economic data from the US were further signs that growth there may be stalling after a strong performance early in the year.

Private job growth accelerated only slightly in May and claims for unemployment benefits rose last week, while factory activity in the US Midwest slowed considerably in May.

In addition there was a reassessment of economic growth in the first quarter of the year.

At 1.9 percent it was softer than the initial 2.2 estimate and considerably down on the 3.0 percent growth rate at the end of last year.

Economic expansion in the second quarter of this year is currently estimated at a pace of about 2.5 percent.

“The economy is growing at an anaemic pace and the job market is showing some signs of hesitation in the pace of hiring. There is a lot to worry about,” said Paul Edelstein, an economist at IHS Global Insight in Lexington, Massachusetts.

Private employers created 133,000 jobs in May, payrolls processor ADP said. That was only a slight step up from April’s tepid 113,000 increase and below economists’ expectations for a gain of 148,000.

The figures were released one day ahead of the closely watched US Labor Department’s employment report for May, which is expected to show some improvement on April’s disappointing total.