Job Creation Slumps in May

Job creation slowed down in May, with total nonfarm payrolls increasing by 138,000 while unemployment was little changed at 4.3 percent. Health care and mining saw jobs gains.

Economists had expected nonfarm payrolls to grow by 145,000 with an unemployment rate of 4.4 percent.

The number of unemployed at 6.9 million and the unemployment rate of 4.3 percent were nearly unchanged from the prior month. Since January, the unemployment rate has fallen by a half a percentage point and the number of unemployed has declined by 774,000.  Labor force participation declined two-tenths of a percent to 62.7 percent, near the lowest levels since the 1970s.

The unemployment rate for whites declined slightly to 3.7 percent in May. The jobless rate for Asians was 3.6 percent, for Hispanics 5.2 percent and for blacks 7.5 percent.

Payrolls grew in health care and mining. Health care added 24,000 jobs, while mining jobs grew by 7,000. Employment in restaurants and bars grew by 38,000. (Amusing aside: the Bureau of Labor Statistics calls bars “drinking places” in its official releases.)

Part time jobs grew by 113,000, while full time jobs fell by 367,000. Much of the jobs created in May were in lower-wage occupations.

Prior months were revised downward. March nonfarm payroll growth came down to 50,000 from 79.000. April fell to 174,000 from 211,000.

The report would appear to support the arguments of President Donald Trump and others that the economy is still running too slowly and would benefit from fiscal stimulus in the form of tax cuts.

 


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