Skip to comments.Bad Numbers, At the Worst Time (Latest employment report is very discouraging)
Posted on 06/01/2012 11:42:37 AM PDT by SeekAndFind
Todays employment report is very discouraging. Analysts had expected employers to create around 150,000 net jobs a bit more than needed to keep up with population growth. We got fewer than half that many: just 69,000 net new jobs. Updates also showed we created almost 50,000 fewer jobs than originally reported in May and April.
Job growth was weak almost across the board. Most sectors showed little to no improvement, with the main exceptions being healthcare (+33,000), transportation and warehousing (+36,000). Manufacturing edged up slightly (+12,000), as did wholesale trade (+16,000). Government employment fell (-13,000), as did construction (-28,000). The latter may be the result of the warm winter moving the start of construction projects (and thus jobs) forward into December and January.
Traditional indicators of labor market strength also showed little improvement. Employers often increase the hours of their existing workforce or hire temporary workers before committing to new full-time employees. Strong labor demand also raises wages. But in May, average hourly wages increased just $0.02, while weekly hours dropped 0.1 hours and temporary-help jobs barely increased (+9,000). In January, temporary-help employment had increased by four times that amount.
The one silver lining is that unemployment numbers are not as bad as advertised. The household survey showed the unemployment rate increasing by 0.1 points to 8.2 percent. Fortunately, this was driven by a 0.2 percentage point increase in labor-force participation rate, not by job losses.
However, there is less to this improvement than meets the eye. It represents a statistical correction from the April report, which showed the unemployment rate falling by 0.1 points and the labor force participation rate falling by 0.2 percentage points. The household survey has a larger margin of error than the payroll survey and often fluctuates like this. Taken over a longer time frame smoothing out statistical noise the household survey also shows few signs of improvement.
This bad report could hardly come at a worse time. With the European economies approaching a crisis, and new GDP estimates showing the economy slowing down, the labor market faces real headwinds. Congress and the administration should think long and hard about the wisdom of hitting employers with the massive tax increases scheduled for the end of the year.
James Sherk is senior policy analyst in labor economics at the Heritage Foundation.
Slowing Down?? (any slower and it would be going BACKWARDS!!)
Zero's campaign slogan: "Forward to 0% growth!"
ABC, CBS, NBC, CNN has been saying things are getting better. President BaBaRock said it isn’t his fault, Bush did it. The public is busy watching sports and drinking.
Well then the public has it half right, if they have the good sense to get drunk and stay there.
How did Massachusetts' unemployment rate during Romney's administration compare to all the other states: Was it near the top or near the bottom? Thanks.
Note: I don't live in Massachusetts, and I don't know much about its unemployment history.
Decent job boards:
Dice (Mostly IT/computer related)