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Friday, June 4, 1999 Published at 13:19 GMT 14:19 UK

Business: The Economy

US labour market tightens

Many US companies are having trouble filling job vacancies

The rate of unemployment in the United States has dipped again to reach a 29-year low in May.

Only 4.2% of the US workforce is now without a job, down from 4.3% in April.

Unemployment among black people fell to the lowest level since records began in 1972.

In May, 7.5% of black Americans were without a job, down from 7.7% the previous month.

However, this is well above the 3.7% unemployment rate for whites.

No jobs growth

The US Labor Department warned that the growth of payroll jobs - by a mere 11,000 - was the smallest in more than three years.

The tiny jobs gain was far below expectations that 225,000 new jobs would be created in May.

Nonetheless, the strong overall demand for workers is astounding given the fact that the country's manufacturing sector continues to be hit by the economic crisis in Asia, Russia and Latin America.

The US job machine is boosted by low interest rates, which triggered a spending boom in housing and other consumer products.

Fears that the US central bank, the Federal Reserve, may soon rise interest rates to combat inflation, have fuelled the housing boom, as Americans take out mortgages to lock in to low mortgage rates.

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