Republicans hit Obama on weak jobs report

WASHINGTON (Reuters) - With an eye on November's elections, Republicans pounced on a weaker than expected jobs report on Friday to cast doubt on President Barack Obama's economic leadership and question if his policies would spur enough growth.

The report was a disappointment for Obama and fellow Democrats, who are anxious for glimmers of economic hope before Congress faces voters in five months, but they argued it showed a continued recovery even if more ups and downs lie ahead.

The May report found hiring by private employers slowed sharply and came in lower than analysts expected, although temporary census hiring pushed payrolls higher and dropped the unemployment rate to 9.7 percent from 9.9 percent.

"The underlying fact is that 9.7 percent unemployment is unacceptable by any standard. No amount of spin will resolve the fact that the president's policies have been a colossal failure when it comes to creating jobs," said Michael Steele, chairman of the Republican National Committee.

Obama stopped at a Maryland truck dealership and parts supplier to tout the report as evidence his policies were working, although he acknowledged the recovery was "still in its early stages."

"This report is a sign that our economy is getting stronger by the day," Obama said. "A lot of businesses that were hit hard during this downturn, they are starting to hire again."

Democrats and the White House are nervously watching the unemployment rate, a key political as well as economic indicator, in hopes an improving outlook will help them retain control of Congress in November.

They frequently stress the economy's slow climb out of its worst recession in 70 years, but stubbornly high unemployment has contributed to broad economic anxiety that has left voters worried and unhappy.

The May report showed private employment was up an anemic 41,000 jobs -- economists had predicted an increase of 190,000 -- even though temporary hiring of 411,000 census workers pushed payrolls higher.

BAD NEWS FOR DEMOCRATS?

The bad news for Democrats is that those hires are likely to come off the employment rolls at the end of summer -- just before voters elect all 435 members of the House of Representatives, 36 senators and 37 governors.

"The Democrats have to be concerned the August or September report that comes out could easily show some big negative numbers when the census jobs go away -- right before the election," said John Silvia, chief economist at Wells Fargo.

"A lot of these congressmen running for office are going to see unemployment rates in their district that are higher than two years ago. People are going to ask them: 'What have you done for two years?'" he said.

Democratic congressional leaders looked on the bright side, noting May was the fifth consecutive month of job growth and promising to do more to pump up the economy. House Speaker Nancy Pelosi called the numbers "another step forward" but said it was not enough.

"We must do more to strengthen our private sector, support our small businesses, and keep our economy moving in the right direction," she said.

Sounding what will be a frequent theme in the months before the election, Republicans said the slow growth in jobs was a result of Obama's failed approach, which they said included bloated federal spending and rising government debt.

Republican Representative Tom Price of Georgia managed to take a shot at the administration's efforts to find jobs for some Democratic Senate candidates in an attempt to avoid damaging primary contests.

"The Obama administration seems to have plenty of jobs to offer to Democrat primary challengers," Price said. "It's too bad most of the 15 million unemployed Americans aren't eligible."

(Editing by Mohammad Zargham)