June Jobs Report: Unemployment Rate Up to 9.2 Percent With Only 18,000 Added Jobs

VIDEO: June labor report shows least monthly number of jobs added so far this year.
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The Labor Department's employment report, released this morning, showed the unemployment rate ticked up to 9.2 percent, with employers adding only 18,000 jobs in June, well below economists' expectations of 110,000 jobs.

The May unemployment rate hit 9.1 percent, after nonfarm payroll employment grew by a modest 54,000 jobs -- which the Labor Department revised down to 25,000 -- well below the 165,000 jobs economists expected to be added.

President Obama reacted to the miserable job numbers Friday by stating the obvious.

"Today's jobs report confirms what most Americans already know," he said. "We still have a long way to go, and a lot of work to do to give people the security they deserve."

The president pointed out that the economy added 2 million jobs during his administration but that the recession had cost it 8 million jobs. "We still have a big hole to fill," Obama said, as he offered some short-term remedies, such as increased infrastructure improvements, the passage of a trio of stalled trade deals and the extension of tax cuts for middle-class Americans.

But the dismal job news came amid high-stakes talks in Washington, where lawmakers seek a bipartisan agreement to extend the nation's debt ceiling before a possible default Aug. 2. The discussions highlight the very real policy differences between the two parties. While the president talks about investing in infrastructure, the top Republican in the country, House Speaker John Boehner, talks about cutting government spending.

"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," said Boehner in a statement. He went on to again reject any legislation that raises taxes, even though Democrats have said they'd include some revenue measures in a debt limit deal.

"Legislation that raises taxes on small-business job creators, fails to cut spending by a larger amount than a debt limit hike or fails to restrain future spending will only make things worse -- and won't pass the House," Boehner said.

Obama said he would "roll up his sleeves" to find a debt ceiling agreement, because passing it would give the markets and the world renewed confidence in the U.S. economy.

Confidence is what's needed, as the job numbers fell well below what economists had predicted.

Stephen Bronars, senior economist at Welch Consulting, said many economists had grown more pessimistic since the May report, forecasting 80,000 jobs for June. "People were overreacting to that bad news," Bronars said Thursday. "I'm a little more optimistic than what I think consensus is."

Perhaps Bronars should have checked his optimism: June showed the worst monthly jobs growth from the private sector since May 2010.

Aside from numbers that continue to show a sharp hiring slowdown, the Labor Department's monthly jobs reports have highlighted the nation's skills gap between what employers require and what employees can offer. The state of the labor market differs depending on one's education, experience and training, said Bronars.

"If you have the right skills, the labor market has been improving substantially over the last year. For people who lack those skills, especially those who may only have a high school degree, they're going to still struggle in the labor market."

According to the 2011 Annual Talent Shortage Survey, 52 percent of U.S. employers in January said they had difficulty finding people with the skills they needed to fill positions.

"That might sound paradoxical or counterintuitive with a high unemployment rate, but the fact is there's a talent mismatch," Melanie Holmes, vice president at ManpowerGroup, which surveyed about 40,000 employers in 39 countries in January, said. "There might be people looking for work, but they don't have the skills people are looking for."

The job skills gap and how to close it remains a "hot topic," said Holmes.

"We've got to cut the deficit, but we can do that while making investments in education, research and technology that actually create jobs," President Obama said in his weekly radio address Sunday. The president was also asked several questions related to entrepreneurship, job creation and training during the first White House Twitter Town Hall meeting this week.

And advanced manufacturing and job creation often come up in discussions about U.S. competitiveness, unemployment and reducing the nation's deficit.

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