Though the official report on May’s job performance doesn’t come in until Friday, early signs aren’t looking good for the U.S. economy.
The LA Times reports that “U.S. private-sector payroll growth slowed sharply in May, falling to the lowest level in eight months,” according to an ADP Employment Services report. Meanwhile, growth in the manufacturing sector slowed more than expected to its lowest level in over 1-1/2 years.
The LA Times reports on the preliminary numbers:
The ADP report showed private employers added a scant 38,000 jobs last month, falling from a downwardly revised 177,000 in April and well short of expectations for 175,000. It was the lowest level since September 2010.
The report boded poorly for the key U.S. non-farm payrolls report at the end of the week. Credit Suisse lowered its estimate for Friday’s employment number to 120,000 from its previous forecast of 185,000 and its private payroll estimate to 135,000 from 200,000.
Unfortunately, sluggish growth isn’t a new story. Last month showed disappointing recovery in the labor market and a slow rate of hiring. But America shouldn’t be surprised given the economic policies of the current administration. It all starts with the hostile business environment the Obama administration has created.
The Heritage Foundation has some ideas for Congress if they want to turn the economy around– reforming regulations to reduce unnecessary business costs, reforming the tort system, removing barriers to energy production, reducing taxes on companies’ foreign earnings if they bring their earnings home, and passing pending free trade agreements.
And in the just-released “Saving the American Dream” plan, Heritage proposes significant reforms to help foster the growth of businesses, simplifying business taxes and enabling businesses to predict the tax consequences of their decisions. Click here to read more about Heritage’s plan, and stay tuned for our analysis of Friday’s jobs report.
