New data casts doubt over US econ recovery

Wed, 03 Jun 2009 16:53:42 GMT

http://www.presstv.com/detail.aspx?id=96921&sectionid=3510213

A report shows that the US private sector cut 532,000 jobs in May indicating that the recession might not be easing as fast as expected.

The payrolls firm ADP's latest figures show a decline compared to the revised 545,000 jobs shed in April.

ADP had originally forecast 491,000 job cuts for April and most analysts had expected 525,000 job losses in May.

The US government has spent trillions of dollars to drive its economy out of the worst recession in years. However, a series of reports on Wednesday showed that the US might fail to resume growth in the second half of the year as expected by many economists.

ADP said the average monthly job losses in April and May stood at 539,000, which showed 'a notable improvement' compared to monthly losses of 691,000 in the first three months of the year.

"Nevertheless, despite some recent indications that economic activity is stabilizing, employment, which usually trails overall economic activity, is likely to decline for at least several more months, although perhaps not as rapidly as during the last six months," it said.

Despite the Federal Reserve's efforts to keep interest rates at near-zero levels, the Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, decreased 16.2 percent to 658.7 for the week ended May 29.

A glimmer of hope came from a report by the global outplacement consultancy Challenger, Gray & Christmas, Inc which showed planned layoffs by US employers fell 16 percent to 111,182 in May, the lowest level in eight months.