Reuters will definitely break out the U word or a variant from today’s unemployment report. The jobless rate edged upward to 9.1% as the economy added only 54,000 jobs in May, far below the estimates of 150K or so, and putting us back under the pace needed to keep up with population growth:
Nonfarm payroll employment changed little (+54,000) in May, and the unemployment rate was essentially unchanged at 9.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains continued in professional and business services, health care, and mining. Employment levels in other major private-sector industries were little changed, and local government employment continued to decline.
The number of unemployed persons (13.9 million) and the unemployment rate (9.1 percent) were essentially unchanged in May. The labor force, at 153.7 million, was little changed over the month.
Chronic unemployment continues to rise, and continues to comprise a greater part of the unemployed as well:
In May, the number of long-term unemployed (those jobless for 27 weeks and over) increased by 361,000 to 6.2 million; their share of unemployment increased to 45.1 percent. (See table A-12.)
The civilian labor force participation rate was 64.2 percent for the fifth consecutive month. The employment-population ratio remained at 58.4 percent in May.
The number of unemployed in the workforce actually rose by almost 170,000, while the number of Americans not in the workforce fell by 105,000. That’s why the unemployment rate rose in this report. However, the workforce level in May 2011 is still more than 500,000 fewer people than a year ago, when the Obama administration tried selling its “Recovery Summer” campaign.
Numbers of recently unemployed declined slightly, a bit of a surprise considering the rise in initial jobless claims over the last seven weeks. Those jobless for less than 5 weeks dropped 27,000, and 5 to 14 weeks by 15,000 since April. Those unemployed longer than 15 weeks went up 329,000, however, and are now at the highest level since January. The increase all comes from those out of work more than 27 weeks, which rose by 361,000, corroborating the numbers before showing that some workers tried reentering the workforce in May and found no work waiting for them. That category also saw its highest level since January.
The AP calls this “startling evidence” that we’re entering an economic slowdown:
The Labor Department report offered startling evidence that the U.S. economy is slowing, hampered by high gas prices and natural disasters in Japan that have hurt U.S. manufacturers.
The pace of hiring has slowed sharply from the previous three months, when the economy added an average of 220,000 new jobs. Private companies hired only 83,000 new workers in May — the fewest in nearly a year.
It’s not exactly startling, is it? We’ve seen nothing but negatives from economic indicators since April. The Q1 GDP was only 1.8%, and this employment report fits the kind of job growth one would see in a 1.8% economy. It’s only startling if you’re not paying attention.
And as predicted, Reuters breaks out a form of the U word, and notes that April’s sunny jobs figures got trimmed by 39,000 in the new report:
Employment rose far less than expected in May to record its weakest reading since September, while the jobless rate rose to 9.1 percent as high energy prices and the effects of Japan’s earthquake bogged down the economy.
Nonfarm payrolls increased 54,000 last month, the Labor Department said on Friday, with private employment rising 83,000, the least amount since June. Government payrolls dropped 29,000.
Economists polled by Reuters had expected payrolls to rise 150,000 and private hiring to increase 175,000 in May. The government revised employment figures for March and April to show 39,000 fewer jobs created than previously estimated.
Well, what idiot sees 1.8% GDP growth — and 0.6% real final sales growth — and thinks that the private sector will add 175,000 jobs? Under those conditions, even the 83,000 that did get added in the private sector is a little surprising. Don’t expect it to happen again in June.