Another month of Bureau of Labor Statistics employment data, another month which exceeded expectations, another month with the usual indifferent or disturbing things behind the marquee figures. Yet May was, overall, a winner.
The best news was fine indeed. One prediction had 220,000 net new jobs created, but it came in at 280,000. That is about double what is needed to cover population increase and is nothing to sneeze at. It’s also one of the best recent months, almost as good as March’s 295,000. Average wages were strong as well, up 8 cents per hour to $24.96, considerably above inflation for a compounded 4.4% annual gain.
Unadjusted unemployment rose from April to May, from 5.1% to 5.3%, but that was almost certain, since consistently more people work in April. Total joblessness accounted for most of the American Job Shortage Number (AJSN)’s increase, but a larger share came from a jump in those wanting work but not looking for at least a year – there were 567,000 more, which, estimating 80% would take a job if one were easily available, added over 450,000 to the metric. The largest offset was from the fall of those not seeking work because of discouragement, with about 180,000 less of them, meaning that group could absorb about 173,000 fewer positions. Perhaps an indication of better employment prospects, as well as a reminder that they are not permanently set in their view, people reporting they did not want a job plunged over 1.4 million, cutting latent demand for this group by 70,800. Overall, the AJSN came in at just under 18.5 million, as follows:
The four most important secondary employment measures were mixed. Labor force participation and employment-population ratio both improved by a tenth of a percent over April, to 62.9% and 59.4% respectively. Both are staying extremely range-bound. The count of long-term unemployed, those officially jobless for 27 weeks or more, remained 2.5 million, and those working part-time for economic reasons, or having part-time jobs but wanting and not finding full-time ones, gained 100,000 to 6.7 million.
Compared with a year before, the AJSN has improved by over 1.2 million, on fewer officially unemployed and, to lesser extents, on fewer discouraged and fewer wanting jobs but not looking for at least 12 months. These one-year gaps continue to be large, meaning that improvement is continuing.
In all, although official adjusted unemployment was up from 5.4% to 5.5%, May was a legitimately good month. It wasn’t worthy of calling an end to the jobs crisis, with the secondary numbers still weak or indifferent. Yet I see job gains as high as 280,000 as much better, if sustained, than those under 200,000, which do little more than accommodate new workforce entrants. We would still need to go back years before the 2008-2009 recession to find worse times, but we’re clearly improving. The turtle is still a turtle, but he is moving steadily forward.