Unemployment rate jumps from 5.0 to 5.5 % 49,000 jobs lost

[JeremyD]

The latest Commissioner's Statement on the Employment Situation
(http://www.bls.gov/news.release/pdf/jec.pdf)
was issued today by the Bureau of Labor Statistics. The text is below.
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Advance copies of this statement are made available to the press under lock-up conditions with the explicit understanding that the data are embargoed until 8:30 a.m. Eastern Daylight Time.


Statement of

Philip L. Rones
Deputy Commissioner
Bureau of Labor Statistics

before the

Joint Economic Committee

UNITED STATES CONGRESS

Friday, June 6, 2008



Madam Chair and Members of the Committee:

Thank you for the opportunity to discuss the employment and unemployment data we released this morning.

The labor market continued to weaken in May. The unemployment rate increased by half a percentage point to 5.5 percent, and jobless rates rose for most major demographic groups. Over the month, nonfarm payroll employment continued to trend down (-49,000). Thus far in 2008, job losses have totaled 324,000. In May, employment declined in construction, manufacturing, retail trade, and temporary help services. Health care continued to add jobs.

Within the goods-producing sector, employment in construction declined by 34,000. Job losses in the industry continued to be widespread. Since its peak in September 2006, construction employment has fallen by 475,000; two-thirds of that decrease (-320,000), however, has occurred in just the past 7 months.

Manufacturing employment also continued to decline in May (-26,000). Thus far this year, monthly job losses have averaged 41,000, about twice the average monthly decline of 2007 and three times that of 2006. Over the month, job declines continued in two construction-related manufacturing industries--wood products and nonmetallic mineral products.

Within the service-providing sector, retail trade employment declined by 27,000 in May. Since peaking in March 2007, the industry has lost 184,000 jobs. Over the month, job declines continued in department stores.

Temporary help services shed 30,000 jobs in May. Job losses have totaled 110,000 over the past 4 months and 193,000 since the industry's most recent employment peak in December 2006.

Health care employment expanded by 34,000 in May, with continued growth throughout the industry. Employment in food services continued to edge up over the month; since last fall, job growth has slowed markedly.

Average hourly earnings for production and nonsupervisory workers in the private sector rose by 5 cents, or 0.3 percent, in May and by 3.5 percent over the past 12 months. From April 2007 to April 2008, the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) rose by 4.2 percent.

Turning now to data from our survey of households, the jobless rate rose sharply in May to 5.5 percent. Unemployment rates increased for adult men, adult women, teens, whites, and blacks. The number of unemployed persons grew by 861,000 to 8.5 million, with the increase disproportionately large among 16- to 24-year olds. The over-the-month jump in unemployment reflected additional workers who had lost their jobs as well as an upsurge in new and returning jobseekers.

In May, the number of newly-unemployed persons (those jobless less than 5 weeks) increased substantially (760,000), and the number of long-term unemployed continued to rise. The number of persons that had been unemployed for 27 weeks or more totaled
1.6 million in May, up from 1.1 million a year earlier.

Over the month, the number of persons in the labor force increased by 577,000, primarily among youth, and the labor force participation rate edged up to 66.2 percent. In May, 62.6 percent of the population was employed, down four-tenths of a percentage point from a year earlier. Since May of last year, the employment-population ratio for adult men has declined by a full percentage point to 71.9 percent, while the rate for adult women has been about unchanged at 58.1 percent. The number of persons working part time who prefer full-time employment was essentially unchanged in May at 5.2 million but has increased by 764,000 over the last 12 months.

I would note that large over-the-month changes in the seasonally adjusted estimates from the household survey can occur between April and July. There is a substantial flow of workers, particularly young workers, into the labor force during these months. The interaction of several factors--including the underlying state of the economy, the timing of the survey reference week each month, and school schedules--can impact the month-to-month movement in our various labor market measures.
While we always caution against reading too much into a single month's data, that is particularly the case at this time of year.

To summarize May's labor market developments, the jobless rate rose to 5.5 percent, the highest since October 2004, and nonfarm payroll employment continued to trend down.

My colleagues and I now would be glad to answer your questions.

[Rearden]

I wish the election were today so Obama can change all this.

[The Gaijin]

What I have read is that many more jobs have been lost - but those were part of that flexible workforce known as "illegals". If you aint on the books and you get fired, you do not count.

[the]

The unemployment numbers were bad in January, and as I predicted then (not very hard to do), they were only going to get worse.

http://forums.pelicanparts.com/showthread.php?t=388599&highlight=unemployment&page=2

By the time Bush leaves office, the economy will be in complete shambles. As part of that, unemployment will be at a modern record high.

Originally Posted by the

Jan. 1, 2008

This is of course no blip on the screen.

How in the world is employment going to not go down, significantly, given what is going on????

Our economic growth has been built on a foundation of sand for the past half decade. The party is over, now it's time to pay.

Originally Posted by the

Jan. 22, 2008
(As far as unemployment, "compared to what," I'd compare it to the last 15-20 years. I predict a the time W leaves office, the unemployment rate will be the highest it has been in the past 20 years).

Originally Posted by the

Jan. 22, 2008
On your unemployment chart, let's see where it is in Winter '08.

Based on your chart, it looks like Bush inherited a 4% unemployment rate when he took office, when he leaves it will be at least 50% higher.

Originally Posted by the

Go back to my original post. I said that part of the carnage that will be present when Bush leaves office will be high unemployment. It will be high. High, compared to where it has been for most of the past 15-20 years. And, at least 50% higher than it was when he took office.

(Of course, he had absolutely nothing to do with that).

[Rot 911]

the Sky Is Falling! The Sky Is Falling!

[the]

For those losing their jobs, it is.

[Rot 911]

Originally Posted by the

For those losing their jobs, it is.

I lost mine back in January 2007. I didn't blame Bush for it.

[JeremyD]

The 49,000 is not as big of a number as I thought it would have been - but the 5.0 to 5.5 is a big increase - watch this number as it is massaged by the media...

and agree - if you are one of the 49,000 - it sux big time.

[the]

Originally Posted by Kurt V

I lost mine back in January 2007. I didn't blame Bush for it.

I don't really blame Bush. Just pointing out that when he leaves office the economy will be in shambles.

Congress, and the rest of the govt, certainly have plenty of blame. Our current Reid/Pelosi Congress has one of the lowest public approval ratings, for good reason. The prior one wasn't good, either.

They all ignored the largest bubble in human history (among other things). They are too busy doing impt things, like going after Roger Clemons.

[Rick Lee]

My dad is losing his job next month and I don't think he even thought about blaming someone else for it. Luckily, he's planned well and doesn't have to worry about working again unless he feels like it.

[Shaun @ Tru6]

the economy is booming, discounter sales are way up

[Jim Richards]

Stimulus check much appreciated in China. xiè xie nin.

[Porsche-O-Phile]

Bush is just hoping to hold things together with duct tape and baling wire as the wheels are coming off - just long enough to run the clock out on his administration (early January). If he can do that, he can dump the problems on the next administration (bonus if it's Democratic) and wash his hands of it.

[Superman]

Originally Posted by Kurt V

the Sky Is Falling! The Sky Is Falling!

The sky seems fairly stable to me. On the other hand America's economic position, its trade imbalance, it's budget imbalance, inflation, fuel costs, unemployment, debt. Plus, we've become a foreign policy laughing stock. After eight years of Dubya, predictably, we're fukt. Hard to imagine being in a worse position at a worse time.

[nostatic]

Originally Posted by Jim Richards

. xiè xie nin.

my, aren't we formal today

[Jim Richards]

my, aren't we formal today, sir!

[Tobra]

Originally Posted by Kurt V

I lost mine back in January 2007. I didn't blame Bush for it.

Why not, it is obviously his fault. He hates you and wants you to be homeless

[Rot 911]

Originally Posted by Superman

After eight years of Dubya, predictably, we're fukt. Hard to imagine being in a worse position at a worse time.

Why hasn't the Democrat controlled Congress done something for these poor unfortunate people? Don't they care?

[Shaun @ Tru6]

Originally Posted by Kurt V

Why hasn't the Democrat controlled Congress done something for these poor unfortunate people? Don't they care?

The quick answer is that they are frickin worms. 75% of them are a waste.

The only slightly more thoughtful answer is there's too much to fix.

And finally, the majority is so slim, nothing much gets done.

But I stick to the worms thesis more than any other.