Economy Watch: Jobs Numbers Disappoint, But Overall Employment Picture Unchanged
- Jun 06, 2011
Anemic hiring in May meant, essentially, that it was more of the same for the economy during the month. That is, according to the Bureau of Labor Statistics, a lot of labor indicators were “essentially unchanged”–unchanged from crummy, unfortunately. For instance, the number of unemployed persons (13.9 million) didn’t budge, but because more people jumped into a job-hunting mode, the unemployment rate ticked up to 9.1 percent.
The civilian labor force “participation rate” was 64.2 percent for the fifth consecutive month, noted the BLS, and the employment-population ratio remained at 58.4 percent in May. The number of persons employed part-time for economic reasons, that is, those who want full-time work but haven’t found it, was also essentially unchanged in May at 8.5 million.
But there was some movement in some labor stats in May, such the number of long-term unemployed–who, according to BLS, are those jobless for 27 weeks and over. That miserable number increased by 361,000, to 6.2 million, with their share of all of the unemployed increasing to 45.1 percent.
ISM Non-Manufacturing Surprisingly Strong
Despite the sluggish numbers for employment growth, the latest Non-Manufacturing ISM Report, which was also released on Friday, painted a more optimistic picture of the economy, with economic activity in the non-manufacturing sector growing in May for the 18th consecutive month. In fact, the Non-Manufacturing Index registered 54.6 percent in May, 1.8 percentage points higher than in April, and indicated continued growth.
There was expansion in 14 non-manufacturing industries that the ISM Report follows, including–somewhat surprisingly–financial services, construction and real estate. There were also gains in retail sales. Interestingly, the Employment Index increased 2.1 percentage points to 54 percent, indicating growth in employment for the ninth consecutive month, and at a faster rate.
So perhaps the recovery isn’t quite dead yet, or even pining for the fjords, despite the latest BLS employment numbers. The industries tracked by the ISM Report did report worrisomely high prices, however, with the prices paid index down slightly, from 70.1 to 69.6. Among the industries that reported higher prices were healthcare, accommodations and food, and professional services.
Americans Still Feel Lousy About Economy
According to a survey released by business-advisory firm AlixPartners L.L.C. on Friday, 63 percent of Americans continue to feel “not good” or “bad” about the state of the U.S. economy, which is a significant bump-up from May 2010, when only 49 percent of Americans felt that sour on the economy.
“There is a lot of positive out there, but it’s being overshadowed by a stubborn, pervasive feeling of uncertainty among Americans and businesses, which has only been compounded by recent global unrest,” Fred Crawford, CEO of AlixPartners, noted in a statement. “Americans continue to push their expectations for returning to a pre-recession ‘normal’ further and further into the future–close enough for comfort, but far enough away to seem realistic.”
Wall Street took another tumble on the weak jobs report on Friday, but curiously enough not as steep as earlier in the week, when the markets were shivering with anticipation about a possible weak jobs report. The Dow Jones Industrial Average lost 97.29 points, or 0.79 percent, while the S&P 500 declined 0.97 percent. The Nasdaq dropped 1.46 percent.