Professional and business services, leisure and hospitality and retail post the month's biggest job gains.
The U.S. economy added a slightly better than forecast 175,000 jobs in May, the Labor Department reported Friday. In addition, employment gains in March and April combined were revised downward 12,000 than previously reported.
The unemployment rate ticked upward to 7.6 percent, a result of the addition of 420,000 into the labor force, which means they can no longer be counted as unemployed.
The jobs report is considered to be the key economic report of the month. The May report has been The May report, The Washington Post reported, is “good enough to suggest that that the economy is expanding at a reasonable pace but not so good that the Federal Reserve will be tempted to prematurely wind down its easing policies.” Speculation that the Fed could scale back its stimulus has led investors to sell stocks and increase bond yields.
There were 11.8 million unemployed persons in May. Among the major worker groups, the unemployment rates for adult women (6.5 percent), whites (6.7 percent), adult men (7.2 percent), Hispanics (9.1 perent), blacks (13.5 percent) and teenagers (24.5 percent) showed little or no change
The civilian labor force rose by 420,000 to 155.7 million in May. However, the labor participation rate—the ratio of those actively employed or looking for work to the overall eligible population—was little changed at 63.4 percent.
In May, the number of those who have been jobless for 27 weeks or more was unchanged at 4.4 million. These “long-term unemployed” accounted for 37.3 percent of the unemployed. The number of “involuntary part-time workers,” persons who were employed part-time because their hours had been scaled back or because they were unable to find a full-time job, wa also unchanged at 7.9 million.
Last month, 2.2 million persons were marginally attached to the workforce, meaning they were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. These individuals are not counted as unemployed because they had not searched for work in the four weeks prior to the survey.
Among these individuals, there were 780,000 “discouraged workers.” These individuals are not currently looking for work because they believe there are no jobs available for them. The remaining 1.4 million persons marginally attached to the labor force in May had not searched for work in the four weeks prior to the survey for reasons such as school attendance or family responsibilities, the BLS said.
Professional and business services added 57,000 jobs in May. Over the past year, employment in this industry has grown by 589,000 jobs. Within this industry, there was most notably a surge in temporary help services (26,000 jobs)
Within the leisure and hospitality industry, employment in food services and drinking establishments rose by 38,000 over the month. Job growth in the food services industry has grown by 337,000 jobs over the past year. Retail jobs increased by 28,000 in May. This industry has added an average of 20,000 jobs per month over the past year. Health care continued its upward trend, adding 11,000 jobs.
Total job creation needs to be between 250,000 and 300,000 to lift the economy and significantly lower the unemployment rate, economists say.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.