NEW YORK, May 30 (Reuters) - The underlying pattern of U.S. employment growth still points upward, despite a slowdown in the last two months, the influential head of the New York Federal Reserve said on Wednesday.
William Dudley, president of the regional Fed bank, told reporters he expects a “gradual decline” in the unemployment rate “stretching out over next few years.”
The U.S. jobless rate stood at 8.1 percent in April, a month in which job growth slowed sharply, as it did in March. The May jobs report is due from the government on Friday.
Dudley and other Fed officials have warned that a series of scheduled tax rises and spending cuts at the end of this year could spell trouble for the slow economic recovery and the labor market.
On Wednesday, Dudley said that if no action is taken on this so-called fiscal cliff, it would be a “huge shock” to the economy and lead to a tightening of gross domestic product growth of some 3 percent.