Today’s unemployment report for June was a mixed bag.  As expected, the overall number went negative as 225,000 Census Bureau workers lost their temporary jobs.  However, a gain of 83,000 private-sector jobs allowed the net loss to come down to 125,000 and the overall unemployment rate to decline slightly to 9.5%.  That still failed to meet analysts expectations, however:

Total nonfarm payroll employment declined by 125,000 in June, and the unemployment rate edged down to 9.5 percent, the U.S. Bureau of Labor Statistics reported today. The decline in payroll employment reflected a decrease (-225,000) in the number of temporary employees working on Census 2010. Private-sector payroll employment edged up by 83,000.

Household Survey Data

Both the number of unemployed persons, at 14.6 million, and the unemployment rate, at 9.5 percent, edged down in June. (See table A-1.)

Among the major worker groups, the unemployment rate for adult women (7.8 percent) declined, while the rates for adult men (9.9 percent),
teenagers (25.7 percent), whites (8.6 percent), blacks (15.4 percent), and Hispanics (12.4 percent) showed little or no change. The jobless
rate for Asians was 7.7 percent, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

In June, the number of long-term unemployed (those jobless for 27 weeks and over) was unchanged at 6.8 million. These individuals made up 45.5 percent of unemployed persons. (See table A-12.)

However, this explains the rate decrease:

The civilian labor force participation rate fell by 0.3 percentage point in June to 64.7 percent. The employment-population ratio, at 58.5 percent, edged down over the month. (See table A-1.) …

In June, about 2.6 million persons were marginally attached to the labor force, an increase of 415,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. (See table A-16.)

Among the marginally attached, there were 1.2 million discouraged workers in June, up by 414,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.4 million persons marginally attached to the labor force had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities. (See table A-16.)

In other words, the topline number declined because we still are seeing a flight from the overall work force. The number of people who have simply stopped looking for work keeps increasing, not decreasing.

Adding 83,000 private-sector jobs is better than the 41,000 added in May, but still not good enough to keep up with population increases.  In order to maintain position as young Americans become eligible to join the work force, we have to add 100,000 jobs a month.  Anything less means we are falling behind.

The Associated Press reports on this issue “unexpectedly” well:

Employers cut 125,000 jobs last month, the most since last October, the Labor Department said Friday. The loss was driven by the end of 225,000 temporary census jobs. Businesses added a net total of 83,000 workers, an improvement from May. But that’s also below March and April totals.

The nation has 7.9 million fewer private payroll jobs than it did when the recession began.

Analysts expected private payrolls to rise by about 110,000, according to Thomson Reuters. The report indicates that businesses are still reluctant to hire as the economy slowly recovers form the worst recession since the 1930s.

The unemployment rate fell as 652,000 people gave up on their job searches and left the labor force. People who are no longer looking for work aren’t counted as unemployed.

And when they come back into the workforce, they’ll make that topline number look worse than it otherwise would when job creation eventually begins.  But that isn’t going to be any time soon, based on the fitful and weak economic growth we’ve seen so far this year.