The American jobs engine hit stall speed in May, with the economy adding just 69,000 new jobs while the unemployment rate climbed to 8.2 percent.

As another summertime swoon looms, the Bureau of Labor Statistics reported that job creation missed economist estimates for 158,000 new positions.

Labor force participation remains near 30-year lows though incrementally better than last month, rising to 63.8 percent.

The unemployment rate that counts discouraged workers rose as well, swelling to 14.8 percent form 14.5 percent in April.

Long-term unemployment also took a sharp upturn, with the number of those out of work for 27 weeks or more jumping from 5.1 million to 5.4 million. The average duration of unemployment moved from 39.1 weeks to 39.7 weeks.

“It’s painfully obvious the economic recovery in the U.S. isn’t just slowing down, it’s pulling up the emergency brake. And, lack of job creation isn’t the only critical concern. Wages/Income is sharply lower,” said Todd Schoenberger, managing principal The BlackBay Group in New York.

“For those lucky enough to have a job, their spending power is sliding when accounting for inflation. The markets will respond negatively to this report,” he added.

Markets reacted immediately to the numbers.

In May, stocks suffered through their worst month in two years, and the job-creation figures only added to the gloom.

Stock market futures indicated a sharply lower open for Wall Street, while investors continued to pour into bonds, sending the 10-year Treasury note yield tumbling to near 1.47 percent. Dow futures looked set to plunge nearly 200 points and crude oil fell more than 4 percent below $83 a barrel.

The bulk of the employment gains came from the service sector, which added 84,000 jobs, while manufacturing grew 12,000. Government shaved 13,000 jobs, including 5,000 at the federal level. Private payrolls rose 82,000.

“Government is the lender and spender of last resort in this economy,” said Doug Roberts, managing principal for Channel Capital Research. “There is no priming the pump, and as government stimulus wears off the economy starts to slow down again.”

Construction took the biggest hit, dropping by 28,000 for the month.

The report comes a month after the government reported that just 115,000 new jobs were added in April, a number that helped contribute to a general malaise about economic growth.

Even that number was worse than thought: The BLS revised the April number down to 77,000.

With worries swelling over the state of the global economy, another weak employment report in the U.S. adds to fears that a sharp slowdown is on the way.

The average workweek, a closely watched economic metric, slipped by 0.1 hour to 34.4 hours. The manufacturing workweek dropped by 0.3 hour to 40.5 hours, and factory overtime fell by 0.1 hour to 3.2 hours.

© 2012 CNBC.com

US Underemployment Real Rate is at 17.90%, compared to 17.90% yesterday and 19.10% last year. This is lower than the long term average of 18.72%. THIS IS OFF AND THE ACTUAL IS MORE LIKE 25 TO 30%
IF YOU EXAMINE THE GDP TO DEBT WHICH I POSTED YESTERDAY IT IS WELL OVER 101% WHICH MEANS THERE ARE NOT ENOUGH PEOPLE WORKING TO PAY OFF THE DEBT.

COMPARE GDP 1.9% TO CHINA GDP 9% SHAMEFUL SHAMEFUL!!! OBAMA IS DESTROYING AMERICA!