After months of big gains in employment numbers, the recovery stalled in May. While the economy added 54,000 jobs last month, that’s a sharp decline from the monthly average of 220,000 jobs added in February, March and April, the Bureau of Labor Statistics reported today. The number also falls short of analyst predictions that about 169,000 jobs would be added.
In addition to weaker job growth last month, the unemployment rate rose for the second time in two months, jumping slightly from 9.0 percent in April, to 9.1 percent in May.
The newest BLS numbers make an already complex jobs picture more puzzling, as some economic indicators show positive signs, while others seem to be making negative progress.
Here’s a rundown of the good — and the not so good — signs for job growth.
1. Online job postings are up: The Conference Board’s monthly “Help Wanted Online” report found that online job postings were up 148,800 last month, to a total of 4.47 million advertised job openings. Additionally, May marked all all-time high for job postings in six of the 22 occupational groups the report covers.
2. Job cuts are down from last year: According to the monthly job cuts report from outplacement firm Challenger, Gray and Christmas, the number of layoffs announced by employers through the end of May 2011 was 22 percent lower than at this time last year. The number of announced cuts month-to-month, however, increased slightly, from 36,490 in April, to 38,810 in May.
3. Despite slowing slightly, private sector job growth is still good: The ADP jobs report, a snapshot of private-sector hiring, came in 137,000 jobs short of economist predictions. Analysts surveyed by Bloomberg predicted that about 175,000 jobs would be added, but when the report was released on June 1st, it showed private sector employment increased by only 38,000 jobs.
The BLS numbers, however, showed a rosier picture for private sector hiring, reporting that 83,000 jobs were added in May, for a total increase of 2.1 million private sector jobs in the last 15 months. Generally, the BLS numbers are seen as a more accurate indicator of job growth.
4. Long-term unemployment still a problem: The number of people unemployed long-term (more than 27 weeks) jumped from 5.8 million in April to 6.2 million in May. That number, however, is still less than the 6.7 million people counted as unemployed long-term in May of last year.
5. Manufacturing growth slows in May: The Institute for Supply Management’s monthly report showed that the manufacturing sector expanded for the 22nd consecutive month, although that expansion slowed in May. The BLS report also showed a decline in manufacturing jobs last month.
In general, last month’s crop of economic reports showed that, while the economy may have slipped from April to May, long-term progress still looks good. A post on the White House blog this morning put it well, saying, “There are always bumps on the road to recovery, but the overall trajectory of the economy has improved dramatically over the past two years … The monthly employment and unemployment numbers are volatile and employment estimates are subject to substantial revision. Therefore, as the Administration always stresses, it is important not to read too much into any one monthly report.” And, while the White House may be a bit partial, the post does make a good point, in that one month of poor data doesn’t cancel out the progress the economy has made since the recession ended in 2009.
Here’s hoping for better numbers next month!
What do you think about the unemployment numbers?