Unemployment Rate Rises ? Slightly

July 6, 2001 (PLANSPONSOR.com) - In June, the US unemployment rate returned to the 4.5% level recorded in April this year, according to numbers released by the Department of Labor.

After moderating to 4.4% in May, the unemployment figure increased by 0.1%. The twin peaks in April and June are the highest levels reached over the year and are fueling concerns on the weakening economy.

The number comes on the heels of other economic data releases that show businesses slashing payrolls by 114,000 over the month, and initial unemployment insurance claims increasing by 7,000 last week.

The report also indicated that average hours worked remained steady in June at 34.3 hours per week. Additionally, inflation pressures seemed to remain in check, with wages rising 0.3% to $14.29 an hour in June, matching May’s rate of increase.

The Labor Department attributed most of the slump in payrolls to a continued contraction in the manufacturing industry. Manufacturing payrolls dropped by 113,000 jobs during the month, the twelfth monthly decline in a row.

However, the service sector was also soft, increasing just 5,000 jobs during the month, the weakest showing since the loss of 15,000 jobs last August.