US jobs data triggers share price slip

US shares have fallen after official unemployment figures showed the rate unchanged at 8.2% in June, with just 80,000 new jobs created.

The figures, from the US Labor Department, show employment growth has slackened from earlier this year, when it averaged more than 200,000.

Shares slipped after the news, with the opening Dow Jones index falling 1%.

Hopes for a high number had risen after Thursday's private sector jobs report came in better than expected.

May's figure of 69,000 new jobs was revised upwards to 77,000.

The figures fall short of the estimated 125,000 monthly pick-up in employment needed by the US economy to keep pace with the expanding population.

People are talking a lot about the weather here, as eastern states swelter under triple-digit temperatures. And today's job figures might make President Obama's collar feel stickier still.

America has now seen four months of lacklustre job gains and there are just four more monthly job reports to go before the country votes. No president since World War II has won re-election with unemployment at more than 7.4%. Today it stubbornly stands at 8.2%, unchanged from May.

And yet a new survey has found economic optimism on the rise. The CNN/ORC International poll suggests 60% of Americans believe the economy will be doing well by 2013, up from just 39% last October.

And confidence is key. Without it, banks won't lend, firms won't hire and consumers won't spend. But is it confidence that an Obama second term will bring big economic gains? Or that President Romney will bring a new approach?

The number is unlikely to boost President Barack Obama as he campaigns for re-election this November.

Speaking in Wolfeboro, New Hampshire, Republican White House candidate Mitt Romney said the jobs data showed a new president was needed, adding "this kick in the gut has got to end".

European stock markets also fell in response to the weak growth. Germany's Dax index and the French Cac 40 both declined by more than 1% following the announcement, while in London, the FTSE 100 was down more than 0.4%.

Most of the US jobs growth was in professional and business services, with the Labor Department saying that employment in other major industries was little changed over the month.

Cary Leahey, economist and managing director at Decision Economics in New York, said the low number could raise hopes that the Federal Reserve would do more to help the economy through further quantitative easing (QE): "It's a weak report at first blush, but it doesn't look as if the tone is any different from the last couple of months.

"There's no meaningful difference between growth of 75,000 jobs and growth of 80,000 jobs. The market will see this as increasing the possibility that QE3 is coming."

The number of long-term unemployed was unchanged at 5.4 million, with this category making up 41.9% of the unemployed.

The number of people employed for fewer hours than they would be willing to work because of a scarcity of full-time employment was also unchanged at 8.2 million.

The category known as "marginally attached" to the workforce, meaning they have not looked for a job in the previous four weeks although they were classed as available for work, fell from 2.7 million to 2.5 million.