Unexpectedly, the unemployment rate jumped by a half percentage point to 5.5% in May, the steepest increase in more than two decades, Labor Department data showed June 6. For the fifth month in a row, the economy lost jobs, shedding 49,000 jobs in May, almost twice the number the prior month. Manufacturing lost 26,000 jobs.
The unemployment rate was the highest in nearly four years as jobs continued to be lost in construction, manufacturing, retail trade and temporary help services, the Labor Department said. Health care continued to add jobs. Manufacturing jobs have not increased in 23 months.
Philip Rones, deputy commissioner at the Bureau of Labor Statistics, cautioned against reading too much into the one month gain. "I would note that large over-the-month changes in seasonally adjusted estimates from the household survey can occur between April and July," he said.
The economy has now lost 324,000 jobs over the last five months, and May was the first time since June 2003 that the economy lost jobs for five straight months. Ongoing job losses have prompted many economists to say the U.S. is in the midst of a recession, although others have said far more jobs -- 100,000 or more -- are normally lost each month during a recession. Economists have said the economy needs to create about 100,000 jobs each month to keep up with new workers, but the economy has averaged a gain of only 11,000 jobs over the last 12 months.
The labor force participation rate, which includes the number of working-aged people with jobs, increased slightly to 66.2%.
Average hourly wages rose 0.3% in February, or five cents, to $17.94.Average hourly earnings over the last year are up 3.5 percent, the same as the prior month. The average workweek remained unchanged at 33.7 hours.
Copyright Agence France-Presse, 2008