0

Job losses spread into retail, financial services

WASHINGTON - Jobseekers had a harder time finding work last month as the economy cooled and wary employers added the fewest positions in two and a half years. The jobless rate edged up to 4.5 percent.

The fresh employment picture provided by the Labor Department on Friday showed that payrolls grew by just 88,000 as job losses spread beyond the struggling manufacturing and construction sectors and into retailing and financial services. Workers' paychecks also grew more slowly.

Given the housing slump, rising energy prices and sluggish overall economic activity, ''businesses are a bit more cautious and reluctant to hire as aggressively as they had,'' said Mark Zandi, chief

economist at Moody's Economy.com. ''Businesses were voraciously hiring people a year ago and now they've got a bit of indigestion.''

The new count of jobs added to the economy was the fewest since 65,000 in November 2004. The rise in the unemployment rate, however, was slight compared with March's 4.4 percent rate - which had matched a five-year low.

Taken together, the figures suggest the employment situation is weakening a bit - but not collapsing - as the nation's economy makes its way through a soft patch. Economists do predict the unemployment rate will climb in the coming months and approach 5 percent by year end, still relatively low by historic standards.