The U.S. economy added only 38,000 non-farm payroll jobs in May, the Bureau of Labor Statistics reported today, falling well below the 155,000 consensus forecast from briefing.com. while the U.S. unemployment rate dropped 0.3 percent to 4.7 percent in May.
The disappointing non-farm payroll report adds more uncertainty about the strength of the U.S. labor market ahead of the Federal Reserve’s June meeting when Fed members were expected to give strong consideration to an interest rate hike.
Over the past 3 months, job gains have only averaged 116,000 per month.
Nearly 40,000 workers in the telecommunications industry were on strike with Verizon in May and did not get included in the company payrolls during the survey period.
Job revisions for the past 2 months decreased by 59,000.
March’s non-farm payroll was revised to 186,000 from 208,000 and April’s payroll number was revised to 123,000 from 160,000.
Employment increased the most in May with healthcare +46,000 followed by information employment +34,000 while the mining sector continued to shed jobs – 10,000.
The civilian labor force participation rate decreased by 0.2 percentage point in May to 62.6 percent.
The average workweek for all employees on private nonfarm payrolls was unchanged at 34.4 hours in May and the average hourly earnings for all employees on private nonfarm payrolls increased by 5 cents to $25.59 after an increase of 9 cents in April.
Yesterday private payroll processor ADP released a May jobs report that showed private payroll growth increased by 173,000 in May, below the 180,000 estimate from briefing.com.
“Job growth has moderated this spring as energy companies and manufacturers shed jobs. Retailers are also more circumspect in their hiring. Despite the recent slowdown, job growth remains strong enough to reduce underemployment” said Mark Zandi, chief economist at Moody’s Analytics.
Written by: John Schweitzer