An Obama administration report Friday showing just 38,000 new jobs were created in May, the fewest number of jobs in more than five years, means the economy is “heading in the wrong direction,” according to JJ Kinahan, chief strategist for TD Ameritrade.
Even the administration’s comment, from Jason Furman of the Council of Economic Advisers, conceded the figure was “considerably below both expectations and the pace of growth in recent months.” Furman, nevertheless, launched into a political promotion for the “important work” Obama wants done, “including investing in infrastructure and job training.”
Reuters reported the results “could make it harder for the Federal Reserve to raise interest rates.”
The Labor Department said nonfarm payrolls rose by only 38,000 jobs, the lowest since September 2010.
Reuters said employers hired 59,000 fewer workers in March and April than previously reported.
“While the unemployment rate fell three-tenths of a percentage point to 4.7 percent in May, the lowest since November 2007, that was in part due to people dropping out of the labor force,” Reuters said.
CNS News pointed out that 94,708,000 Americans were completely out of the labor force in May.
That was up 664,000 from April, leaving the labor force participation rate down at 62.6 percent.
“When President Obama took office in January 2009, 80,529,000 Americans were not participating in the labor force; since then, 14,179,000 Americans have left the workforce – some of them retiring and some just quitting because they can’t find work,” the report said.
In contrast, Obama told a rally this week: “By almost every economic measure, America is better off than when I came here at the beginning of my presidency. We cut unemployment in half, years before a lot of economists thought we would.”
Marketwatch said the fall in the government’s announced unemployment rate, from 5 percent to 4.7 percent, was “owed almost entirely to 458,000 people leaving the labor force.”
The report said most industries eliminated jobs last month, and “in another bad sign” cited by Marketwatch, “temp employment fell by 21,000 and it’s down 64, 000 so far this year.”
Said the report: “The dropoff in temporary work in 2016 is the sharpest of the seven-year-old recovery and might be a sign that hiring is likely to remain soft. Temp hiring usually increases when the economy is strong, with many of those workers eventually getting hired full time.”
Another impact on the job markets: a strike at Verizon that kept 35,000 employees out of work.
According to the Wall Street Journal, “May’s weak job growth and the revisions bring the average monthly job gains in the past three months to 116,000, a sharp slowdown from the average 219,000 growth over the prior 12 months.”
“This was an unqualified dud of a jobs report,” Curt Long, chief economist at the National Association of Federal Credit Unions, told the Journal.
He said the unemployment rate fell, but “for the wrong reason as labor force participation declined for the second consecutive month.”
The government’s report, described by many as “weaker-than-expected,” is the final job-market indicator that will arrive prior to the Federal Reserve’s meeting starting June 14.
The Bureau of Labor Statistics notes that in May, there were 158,466,000 participating in the labor force. That’s 62.6 percent of the 253,174,000 included in the civilian noninstitutional population, which is defined as those 16 or older who are not in the military or an institution.
Analysts had predicted 158,000 job additions.
Furman argued for more of Obama’s agenda.
“This month’s report is a reminder of the important work that remains to sustain faster growth in jobs and wages, including investing in infrastructure and job training, implementing high-standards trade agreements like the Trans-Pacific Partnership, and raising the minimum wage,” he said.
from PropagandaGuard https://propagandaguard.wordpress.com/2016/06/03/38000-new-jobs-report-highlights-deterioration-in-the-labor-market/
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