U.S. sheds 125,000 jobs in June

The U.S. economy shed 125,000 jobs in June, the first time employment has shrunk since December.

"The economy is losing some momentum," said Ryan Sweet, senior economist at Moody'sEconomy.com. "We [needed] to see private hiring really accelerate."

Analysts pay closer attention to private employment numbers, since they're deemed to be the more accurate gauge of the real economy.

Private employers added 83,000 jobs during the month, according to U.S. Department of Labour statistics released Friday.

That's an improvement on May's weak showing of 41,000, but worse than the 112,000 that analysts were expecting. America now has 7.9 million fewer private payroll jobs than it did when the recession began.

May's overall figures were buoyed by the 240,000 temporary workers hired to conduct the U.S. census during the month. Without that, the job market would have shrunk, and that manifested itself in the June data.

"There is no doubt that U.S. employment, along with the broader economy, has lost some of its momentum," BMO economist Michael Gregory noted.

While he has some concern oved tepid private-sector hiring, June's figures were not far off the 102,000 average of the past five months and are above May’s 33,000 reading.

Despite the lost jobs, the unemployment rate edged down to 9.5 per cent, due to 652,000 people giving up on their job searches and leaving the labour force. People no longer looking for work aren't counted as unemployed.

All told, 14.6 million people were looking for work during the month. Average hourly earnings decreased by two cents, or 0.1 per cent, to $22.53. The average workweek decreased by 0.1 hour to 34.1 hours.

"Every effort to dig us out of our 10.5-million jobs hole is being stymied by excuses about the deficit," AFL-CIO president Richard Trumka said in reaction to the news. 

"This is not to say the federal budget doesn’t need attention — it does, but over the long term. Right now we have an immediate jobs crisis, and unless we address it soon, we’ll only make the nation’s economic conditions worse."