(Image Source: CBS )

BY MATTHEW PICHT

 

The Labor Department’s May jobs report is out. Here’s HLN with the market’s reaction:

 

“‘Uurgh!’... Big disappointment, very ugly. The DOW Futures immediately slid very sharply, so that tells you that the stock market is thinking it's ugly. Only 69,000 new jobs.”

That’s less than half of the predicted number, 150,000. The unemployment rate rose to 8.2 percent as well. After a positive first quarter, an economic slowdown is at hand.

“The May jobs report indicates growth could be even slower in the second quarter and the economy is dangerously close to stalling and falling into recession.”

April’s job growth numbers were adjusted downward. Bloomberg points out, this revision proves that May’s disappointing numbers are part of a definite trend.

“The average in the first quarter for job creation in the U.S.: 226,000 jobs. The last two months, the average down to 73,000. Something is up with the U.S. economy.”

Low job numbers could have major ramifications in the upcoming election. An analyst for The Wall Street Journal says, signs of a slowdown may seriously hurt the President’s hopes for reelection.

“The Obama campaign is going to have much greater difficulty arguing that they’ve engineered a turnaround. They will, of course, be arguing that a lot of this is due to problems overseas for the third straight year, but the fact remains that a slowing economy is not good for the incumbent.”

But an analyst for CNN Money cautions against reading too much into the latest job numbers. The unemployment rate is an unreliable indicator of economic growth: Rising unemployment numbers may actually be a good sign.

“Because the unemployment rate counts only workers actively seeking jobs, a shrinking labor force has actually made joblessness decline...Today's news that the rate rose reflected a glimmer of positive news: More unemployed people are returning to the job hunt, suggesting economic optimism.”

More silver lining for this thunderhead: consumer spending is up 0.3 percent, and the average income has increased by 0.2 percent.