Stock futures took a hit Friday due to disappointing news on the nation’s unemployment front.
According to the Department of Labor, employers added 431,000 jobs in May. However, the large majority of those jobs were temporary U.S. census positions. Otherwise, the net job gain from the private sector was only 41,000.
On Friday afternoon, the Dow Jones Industrial Average was down more than 200 points, due in good part to the news. Still, the outlook wasn’t completely bad.
The Department of Labor also reported that the unemployment rate has fallen to 9.7 percent, down from 9.9 percent the previous month. Also, manufacturing, temporary help services and mining industries all experienced job creation.
A report by CNBC quoted Todd Schoenberger of LandColt Trading as calling the latest jobs report “extremely disappointing,” while also citing several previous weeks of rising first-time unemployment claims. CNBC also noted that economists had been expecting a figure closer to 500,000 jobs created last month.
Despite overall optimism about the direction of the economy, many companies are depending on increased consumer spending to rebuild their profitability in the aftermath of the recession. However, that will be far more difficult to accomplish if unemployment remains as high as it has been.
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