Behind the hard numbers in Friday’s dismal report on the job market are scared small-business owners, slashed state budgets, dried-up federal stimulus funds and a lingering uncertainty that has taken hold from corporate boardrooms to factory floors around the country. That deterioration in the labor market marks only the latest in a slew of recent signs that the economic recovery is losing momentum.
Employers from coast to coast describe a situation in which tepid economic growth alone isn’t enough to prompt them to add to their payrolls. Sales have been rising, but slowly and tenuously. Doubts about the future have continued to chip away at confidence and prevented many business people from taking the leap of faith required to expand and hire new workers.
“Everybody is so fearful right now because of the uncertainty about the future,” said Bill Hall, who owns five Dairy Queen franchises around Fort Worth. “It’s a problem that’s impacting all of us. That uncertainty and that fear is the number one reason you’re not seeing job growth. . . . Everybody is in a situation where they’re afraid to make a move. Unfortunately, that’s caused everything to come to a standstill.”
That standstill showed in the numbers released Friday, which revealed that the job market weakened across a wide range of industries in May. Manufacturers cut 5,000 jobs, due in part to disruptions from the earthquake in Japan. Retailers shed 8,500 jobs. The leisure and hospitality industry cut 6,000 jobs.
The largest job losses were in a public sector that is rapidly retrenching. Local governments have been cutting jobs in vast numbers — 28,000 in May — trying to eliminate their yawning budget gaps by dismissing public employees.