US jobless scene may not paint a pretty picture

WASHINGTON: The jobless rate probably rose in September for a second month as the year-old US recovery failed to generate enough jobs to keep up with a growing labour force, economists said before a report this week.

Unemployment climbed to 9.7% from 9.6% in August, according to the median estimate of 62 economists surveyed by Bloomberg News ahead of an October 8 report from the Labour Department. The data may also show companies added 77,000 workers to payrolls, and total hiring stagnated amid cuts in government staffing as the decennial census wound down.

A lack of jobs is restraining consumer spending, the biggest part of the economy, and underscores the Federal Reserve’s concern that the rebound from the worst recession since the 1930s has been too slow to develop. Economists surveyed by Bloomberg project unemployment will average at least 9% through 2011.

The US has “a difficult labour market and mediocre GDP growth”, said Ryan Sweet, a senior economist at Moody’s Economy.com in West Chester, Pennsylvania.