That will likely put pressure on the Federal Reserve to reconsider launching new measures to try to stimulate economic growth. With Congress gripped by partisan gridlock, the Fed is essentially the only government institution with the power to try to reduce unemployment. Lately, Fed officials have suggested they are not planning to do anything more, in large part because the economy seemed to be doing so much better.
But now the Fed may have to take another look at the question when officials gather for a policymaking meeting later this month. Many economists do not expect the Fed to take any new action then, but the central bank could set the stage for additional efforts later this summer if the economic recovery continues to be weak.
Speaker of the House John Boehner responded to the weak jobs report, saying the economy would be better if the White House and Democrats had worked with Republicans.
Is the recovery slowing? A detailed look at the unemployment and jobs situation.
Among the steps the Fed might take are a firm commitment to hold interest rates at extremely low levels for an even longer period of time — officials now project keeping them low through at least late 2014 — and a new round of Fed purchases of Treasury bonds or mortgage-backed securities — “quantitative easing,” in Fedspeak.
Analysts say the country needs to add roughly 130,000 jobs per month for the recovery to maintain its momentum. But to truly make a dent in the unemployment rate, hiring must reach a sustained rate of 250,000 jobs a month. The country has hit that mark only three times over the past year and a half.
“We had a tease,” said Keith Hall, a senior research fellow at George Mason University and former commissioner of the Bureau of Labor Statistics. “It just didn’t last.”
In May, the health-care and transportation sectors each hired more than 30,000 people, the most of any industry. But those gains were offset by a sharp drop in construction jobs. Economists said a small increase in the number of people who are now looking for work also helped drive up the unemployment rate.
There were small rays of optimism, however. The government also reported that consumer spending rose by 0.3 percent in April and that incomes increased 0.2 percent. Automakers announced strong May sales, with Chrysler up 30 percent in the United States. Ford and General Motors also posted double-digit gains.
But that was not enough to dispel the fog of uncertainty over the direction of the recovery. Carl Camden, chief executive of Kelly Services, a global staffing firm, said businesses will only hire when they are confident that demand will emerge to support those jobs. In addition to worries over Europe, he said his clients remain concerned about domestic issues such as health-care costs and what the presidential election will mean for taxes and government spending cuts.
“Very few companies are willing to take money and invest in the future now,” he said.
Staff writers Zachary S. Goldfarb and Phil Rucker contributed to this report.