For those who have forgotten what the real problem is: Obamas Policies.
Job Creation Light, Claims Up, Economy Grows Just 1.9%
Private payroll growth accelerated only slightly last month and claims for jobless benefits rose last week, suggesting the U.S. labor market recovery was stalling after a strong performance early in the year.
"It shows we're in a lackluster period in the economy right now," said Wayne Kaufman, chief market analyst at John Thomas Financial in New York.
Private employers created 133,000 jobs in May, payrolls processor ADP said. That was below economists' expectations for 148,000 jobs.
The report comes ahead of Friday's closely watched employment report for May, which is expected to show that nonfarm payrolls increased 150,000, up from a paltry 115,000 in April. Job creation accelerated between December and February as the economy got a boost from an unusually warm winter.
"This number could have some weather payback in it, but I think basically it confirms and reinforces the notion that there was a sharp deceleration of employment in the springtime months," Joel Prakken, chairman of Macroeconomic Advisors, told CNBC's "Squawk Box."
"It's not particularly surprising given the recent weakness in the macroeconomic data, but it's certainly disappointing and well short of what we need to see the national unemployment rate fall on a consistent basis."
While economists have largely shrugged off the recent cooling in the labor market as payback for strong gains during winter, there are signs of fundamental weakness.
Another report showed the number of planned layoffs at U.S. firms rose to an eight-month high in May as computer maker Hewlett-Packard said it would cut about 8 percent of its workforce.
Employers announced 61,887 jobs cuts this month, a surge of 52.6 percent from 40,559 in April, according to consultancy Challenger, Gray & Christmas Inc. The computer industry accounted for 27,754 of the planned jobs cuts.
"These employment numbers are getting to the disappointing side now .... and really are suggesting that labor market momentum has stalled at this point," said Sean Incremona, an economist at 4cast in New York.
Growth Revised Down
Separately, gross domestic product increased at a 1.9 percent annual rate in the first quarter, down from the 2.2 percent the Commerce Department had estimated last month. The economy grew at a 3.0 percent rate in the fourth quarter.
The report also showed that after-tax corporate profits dropped for the first time in three years last quarter.
A modest downward revision to consumer spending, which accounts for about 70 percent of U.S. economic activity, and stronger import growth also accounted for the weaker first-quarter output. Economists polled by Reuters had expected growth would be revised down to a 1.9 percent pace.
Business inventories increased $57.7 billion, instead of $69.5 billion, adding only 0.21 percentage point to GDP growth compared with 0.59 percentage point in the previous estimate.
While the small inventory build-up held back growth in the January-March quarter, restocking of shelves, retreating gasoline prices and an improving housing market should provide a boost to output in the second quarter.
Growth in the second quarter is currently estimated at a pace of about 2.5 percent.
Excluding inventories, the economy grew at a revised 1.7 percent rate in the first quarter, rather than 1.6 percent and up from 1.1 percent in the fourth quarter.
Consumer spending grew at a 2.7 percent pace instead of the previously reported 2.9 percent. It was still an acceleration from the fourth-quarter's 2.1 percent pace.
Government spending fell at a much steeper 3.9 percent rate, instead of the previously reported 3.0 percent. Both exports and imports were much stronger than initially estimated.
On the positive side, business spending on equipment and software was revised up to show a much firmer 3.9 percent growth rate instead of the previously reported 1.7 percent.
However, there are signs business spending weakened early in the second quarter.
Residential construction was revised slightly up in the first quarter and the retrenchment in investment on nonresidential structures was not as deep as previously thought.
The department also said after-tax corporate profits fell at a 4.1 percent rate, the biggest decline since the fourth quarter of 2008, as taxes took a big bite from earnings. After-tax profits rose 1.1 percent in the fourth quarter.