Payrolls grew by just 78,000 in May

Jeannine Aversa:

Employers throttled back hiring in May, boosting jobs by just 78,000, the government reported Friday. The most sluggish pace of payroll expansion in nearly two years dramatized the erratic behavior of the nation's job market.

Despite the slow growth in payrolls, the Labor Department's latest snapshot of the jobs picture in the United States showed that the civilian unemployment rate actually dipped fractionally last month — to 5.1 percent. That was down a notch from April's 5.2 percent jobless rate and was the lowest overall since September 2001.

The payroll gain of 78,000 followed a hiring spurt of 274,000 in April. Job cuts last month were reported in the categories of manufacturing, leisure and hospitality, and professional and business. Those losses tempered gains elsewhere.

The generally lackluster performance surprised economists. Before the report was released, they were predicting jobs to grow by around 175,000 and the jobless rate to hold steady at 5.2 percent.

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