Employers added 431,000 nonfarm jobs nationwide in May, the biggest increase in a single month in a decade, the Labor Department said Friday. But the bulk of the growth was in government jobs, driven by hiring for the Census, and private-sector job growth was weak. þþThe unemployment rate fell to 9.7 percent nationwide, from 9.9 percent in April, the department said. þþThe figures for May represented the fifth consecutive month that payrolls have risen, but fell below analysts’ expectations that 540,000 jobs would be added to the economy. þþThe shortfall was immediately reflected in futures trading in the Wall Street stock indexes, with the Dow Jones industrial average expected to open almost 2 percent lower. þþAltogether, 411,000 of the jobs added were for Census workers whose positions will disappear after the summer. þþThe net gain in government jobs was 390,000, while the private sector added only 41,000. þþIn April, nonfarm payroll employment grew by 290,000, but the unemployment rate rose nevertheless to 9.9 percent because of a surge in the labor force. þþThe economy has to add more than 100,000 jobs every month to absorb the new entrants to the market. And they are joining a labor pool that is already swollen with 15 million Americans looking for work. þþMore than eight million people have lost their jobs since the start of the recession in December 2007. þþ“You would need to be producing 150,000 to 200,000 jobs a month to be making a dent in this,” said Doug Roberts, chief investment strategist for Channel Capital Research. þþIn addition, the quality of the jobs was important as well. “If you are getting people back to work but they are earning less, they are spending less,” Mr. Roberts said. “It does not affect the underlying condition.” þþEconomists are hoping that a recovery in the job market will lead to improved consumer spending, which accounts for 70 percent of the economy. þþThe Manufacturers Alliance/MAPI, a trade association, said this week that the sector was rebounding, based on low consumer inventories and strong gains in exports. Manufacturers are “bullish on job growth in a sector that is not known for job creation,” said Daniel J. Meckstroth, the group’s chief economist. “The supply-chain pipeline is filling with orders and manufacturing firms are reluctantly, but out of necessity, adding staff,” he said. þþBut the Labor Department report on Friday showed that growth in manufacturing jobs was offset by losses in construction jobs. And there was a gain of 31,000 in temporary service jobs in May, meaning employers are not entirely convinced they want to commit to permanent hires. þþAnother area of weakness was in jobs for state and local governments, which are grappling with budget cuts. They shed 22,000 workers in May. þþInvestors have been watching the job figures for signs of health in the economic recovery. Corporate earnings for the first quarter have been generally stronger than expected, which raises hopes for more jobs. But there are still uncertainties from the European debt crisis hanging over the financial sector, and how that will affect credit availability. A further strengthening of the dollar could lead to export stagnation and hit the bottom line of companies that rely on sales abroad. þþThe Labor Department figures show that the number of those unemployed for a long time continued to grow. Almost 6.8 million had been out of work for more than six months in May, and the average length of time that people remained out of work grew to 34.4 weeks, up from 33 weeks in April. When that figure reached 31.2 weeks in March, it represented the longest period since 1948, when the government started to keep track of such records. þþThe so-called underemployment rate, however, fell to 16.6 percent in May from 17.1 percent in April. The rate includes people whose hours have been cut in their jobs, and those who accepted part-time jobs because they could not full-time work. The rate was 16.9 percent in March. þþThat means 8.8 million people were working part time in May who preferred full-time work, compared with 9.15 million in April. þþAnthony Watler of Rosedale, Queens, might find himself in that category. This week Mr. Watler, 58, put on a fresh shirt and suit and went to a Suffolk County job fair to look for work as an accountant, a job he lost when he was laid off in 2008, earning $80,000 a year. þþAfter working in a temporary part-time job, Mr. Watler went on unemployment in January and uses the $425 a month in benefits while drawing down from his retirement account to make monthly mortgage payments of $2,000. þþHe has searched for work on the Internet and gone on job interviews. þþ“I always feel hopeful,” Mr. Watler said. “Until I get home and a couple of weeks pass and I don’t hear anything.” þþOn Wednesday he filled out an application and left his résumé at the job fair. He was told by one company that it did not need an accountant now, but he said he was willing to do whatever that business or any other had to offer. þþ“I would accept anything that is above unemployment,” he said. þþ
Source: NY Times
