WASHINGTON, July 8, (Agencies): US jobs growth ground to a near halt in June, with employers hiring the fewest workers in nine months, frustrating hopes the economy would bounce back quickly from a slowdown in the first half of the year.
Nonfarm payrolls rose only 18,000, the weakest reading since September, the Labor Department said on Friday, well below economists’ expectations for rise of at least 90,000.
The unemployment rate climbed to a six-month high of 9.2 percent from 9.1 percent in May even as jobseekers left the labor force in droves.
“The message on the economy is ongoing stagnation,” said Pierre Ellis, senior economist at Decision economics in New York. “Income growth is marginal so there’s no indication of momentum.
Stocks on Wall Street opened lower on the data, while US Treasury debt prices rallied. The dollar was little changed against a basket of currencies.
The government revised April and May payrolls to show 44,000 fewer jobs created than previously reported.
The report shattered expectations the economy was starting to accelerate after a soft patch in the first half of the year.
It could prompt calls for the Federal Reserve to consider further action to help the economy, although officials have set a high bar after completing a $600 billion bond-buying program last week.
“This confirms our view that the Fed will continue to keep rates on hold into 2012 and if weak employment continues it will be pushed out even further,” said Tom Porcelli, chief economist at RBC Capital Markets in New York.
Hopes were high that the economy was starting to find firmer ground as motor vehicle manufacturers ramped up production and gasoline prices descended from their lofty levels.
Economic activity in the first six months of the year was dampened by rising commodity prices and supply chain disruptions following Japan’s devastating earthquake in March.
The data is a blow to the Obama administration, which has struggled to get the economy to create enough jobs to absorb the 14.1 million unemployed Americans. It could stiffen the resolve of Democrats to push for near-term stimulus as they seek a deal with Republicans to cut the US budget deficit.
The economy is the top concern among voters and will feature prominently in President Barack Obama’s bid for re-election next year.
So far, the economy has regained only a fraction of the more than 8 million jobs lost during the recession.
Republicans were quick to criticize the administration.
“Today’s report is more evidence that the misguided ‘stimulus’ spending binge, excessive regulations, and an overwhelming national debt continue to hold back private-sector job creation in our country,” House of Representatives Speaker John Boehner said in a statement.
The economy needs to create between 125,000 and 150,000 new jobs a month just to absorb new labor force entrants.
White House economic advisor Austan Goolsbee told Reuters Insider that the economy was not facing a double-dip scenario, but said the weak jobs number should be a wake up call for both Democrats and Republicans to stop bickering about policy.
“This is not a double-dip. This is a reflection and reiteration that the growth rate slowed at the beginning of this year and that clearly has an impact on job creation,” he said.
Obama said Friday the US economy has “a long way to go” towards a strong recovery, after the government released weak jobs figures.
Obama said the poor jobs report “confirms what most Americans already know,” that the recovery from what he described as the “worst downturn in our lifetimes” is slow and painful, and that it was vital to get the economy on a sounder footing.
“Our economy as a whole just isn’t producing nearly enough jobs for everybody who’s looking,” Obama said in brief comments at the White House.
“We still have a long way to go and a lot of work to do to give people the security and the opportunity they deserve,” he added.
“We have added more than two million private sector jobs in the past 16 months, but the recession cost us more than eight million, and that means that we still have a big hole to fill.”

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TORONTO: The Canadian economy created 28,000 jobs last month, helped by a gain the part-time jobs to post its third consecutive month of growth.
Statistics Canada said Friday the country’s unemployment rate held steady in June at 7.4 percent as the number of people entering the workforce increased.
The increase in jobs was mainly in the part-time sector, which added 21,000 jobs, compared with 7,000 new full-time jobs.
Economists had expected an overall increase of 10,000 jobs.
The Canadian results compared with a gain of just 18,000 jobs in the much larger US economy for June and an employment rate at 9.2 percent, according to the US Labor Department.