Job Growth Fairly Flat in May
JOB GROWTH: Employment grew by a mere 38,000 in May, down from last month and a year ago, and still far lower than newly reduced numbers for April and March.
TOP INDUSTRIES: Employment was up in healthcare, while mining continued to contract. The information sector took a hit due to a labor strike that has now been resolved.
UNEMPLOYMENT: The unemployment rate dipped further to 4.7 percent, its lowest point since 2007. The lower rate reflects an increase of nearly half a million people in “involuntary” part-time employment (i.e., people who would prefer full-time work, if they could find it).
WAGES: Salaries gained another five cents this past month, reaching an average hourly rate of $25.29, following a slightly higher increase last month. Over the past 12 months, pay has risen 2.5 percent.
WORK WEEK: The average workweek was unchanged at 34.4 hours in May.
TEMPORARY JOB TRENDS: While temporary staffing jobs had shown an upswing last month, May saw a return to the downward trend of recent months, with a decrease of 21,000 jobs in May.
SO WHAT DOES IT ALL MEAN? While jobs growth has slowed to a near stall, most economists insist this is no cause for panic. Secretary of Labor Thomas E. Perez suggests that the closer we get to full employment, the smaller the gains become, and this is not out of the ordinary. The bottom line for employers: there are fewer job candidates available to fill open positions, making recruiting more challenging and putting the brakes on hiring. The small but steady increases in pay should translate to greater consumer purchasing power, which is a positive sign for the economy. At this point, rather than signaling a downturn, slower job growth may simply be a return to pre-recession normalcy.
Sources: U.S. Bureau of Labor Statistics (BLS), Steinberg Employment Research, Bloomberg, The Los Angeles Times, USA Today, CNBC, CNN Money, Staffing Industry Analysts, ERE Media