May Payroll Data Shows Little Progress

Manufacturing employment increases by 12,000.

Nonfarm payroll employment increased in May by 69,000, raising fears that job gains would again slow this summer as they did last year. Both the number of unemployed persons (12.7 million) and the unemployment rate held steady at 8.2%, the U.S. Bureau of Labor Statistics reported.

Employment increased in health care, transportation and warehousing, and wholesale trade, BLS noted, but declined in construction. Employment was little changed in most other major industries.

"There's no way around it: the May jobs report is terrible new," said Scott Paul, executive director of the Alliance for American Manufacturing. "We see a palpable slowdown in manufacturing hiring."

"Economists will often offer a sober reminder that one month of soft data does not make a trend. But 3 months does," observed Beata Caranci, vice president and deputy chief economist for TD Economics. "Theres been a downshift in private sector job growth from an average of 255,000 per month to 96,000, and this cant be dismissed."

The number of long-term unemployed (those jobless for 27 weeks and over) rose from 5.1 to 5.4 million in May. These individuals accounted for 42.8% of the unemployed.

The number of persons employed part time for economic reasons (sometimes referred to as involuntary part-time workers) edged up to 8.1 million over the month. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

The May increase of 69,000 jobs was similar to the April number, which was revised down from the 115,000 originally reported to 77,000. March job gains were also trimmed, from 154,000 to 143,000.

Manufacturing employment continued to increase in May (12,000), a slight improvement from April's gain of 9,000 jobs. AAM's Paul noted that the May number was "well below the trend of steady factory job growth since 2010."

Job gains in manufacturing averaged 41,000 per month in the first quarter of this year. In May, employment rose in fabricated metal products (6,000) and in primary metals (4,000).

Since its most recent low in January 2010, manufacturing employment has increased by 495,000.

Construction employment declined by 28,000 in May, with job losses occurring in specialty trade contractors (-18,000) and in heavy and civil engineering construction (-11,000).

The average workweek for all nonfarm private employees edged down by 0.1 hour to 34.4 hours in May. The manufacturing workweek declined by 0.3 hour to 40.5 hours, and factory overtime declined by 0.1 hour to 3.2 hours.

The average workweek for production and nonsupervisory employees on private nonfarm payrolls was unchanged at 33.7 hours.

In May, average hourly earnings for private employees edged up by 2 cents to $23.41. Over the past 12 months, average hourly earnings have increased by 1.7%. In May, average hourly earnings of private-sector production and nonsupervisory employees edged down by 1 cent to $19.70.

TAGS: The Economy
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