That is not a typo: last month, according to the Bureau of Labor Statistics, the economy added just 38,000 jobs to public- and private-sector, non-farm payrolls. That’s considerably lower than economists estimated before this morning’s release of the monthly The Employment Situation Summary; economists polled by Reuters predicted the addition of 162,000 jobs.
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The unemployment rate declined to its lowest since November 2007, primarily due to nearly half a million Americans dropping out of the labor force. The labor force participation rate declined 0.2 percentage point to 62.6 percent, while the number of workers employed part-time for economic reasons increased by 468,000 to 6.4 million.
Healthcare was a rare bright spot among industries last month, adding 46,000 jobs. Professional and business services added 10,000 jobs in May, after adding 55,000 jobs in April.
Mining shed 10,000 jobs in May, while manufacturing lost 18,000 jobs. Information declined by 34,000 jobs, largely due to the Verizon strike.
Other industries changed little for the month, including construction, retail trade, wholesale trade, leisure and hospitality, government, transportation and warehousing, and financial activities.
“Boy, this is ugly,” Diane Swonk, an independent economist in Chicago, told The New York Times. “The losses were deeper and more broad-based than we expected, and with the downward revision to previous months, it puts the Fed back on pause. …The only good news is that wages held.”
Average hourly earnings for private-sector employees increased by 5 cents to $25.59, after increasing 9 cents in April. Average hourly earnings have increased 2.5 percent for the year. The PayScale Index, which measures the change in wages for employed U.S. workers, forecasts 2 percent year-over-year wage growth for Q2 2016.
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