Employment Growth is Stagnating
Posted by Jason Apollo Voss on Jun 3, 2011 in Blog | 2 commentsThe Bureau of Labor Statistics announced this morning that the economy created 54,000 jobs in May. This compares to economist expectations for 160,000 jobs created. Separately, the unemployment rate rose to 9.1%, while economists had expected a decline to 8.9%. Private sector jobs grew by 83,000, while government jobs shrank.
Analysis: That the economy added jobs is a good thing. However, it’s obvious that employment growth is stagnating, so let’s not put lipstick on this pig. Job creation in the previous three months averaged 220,000. Economists were clearly expecting a much higher number of jobs to be created and that they were off by so much is a strong indication of a volatile, unpredictable national jobs situation.
There are several positive notes, however.
One, the size of the workforce did not change much in May. That means that the job creation in May wasn’t just an absorption of those who were previously unemployed, but had exited the job search world, only to re-enter the fray once good jobs news started happening earlier this year.
Second, the private sector continues to add jobs. This is important because the private sector is typically the driver of gross domestic product (GDP) growth.
Importance grade: 10; today’s data is a startling reminder that the hangover effects of the Great Recession linger on. June’s job growth number will be very, very important for evaluating the state of health of the economy.
Jason
Really? This is what your ‘intuition tells you now?’ How can it be intuition if it’s been all over the news first.
That’s not intuition, it’s regurgitation.
Hello!
First, thanks for your comment, it is much appreciated.
Second, I am appreciative of your filling a role as Hypocrisy Policeman. A function, on your part, that I am open to. Thanks for taking on this, often, thankless task.
Third, the name of my blog is “What My Intuition Tells Me Now,” so the title of any individual post needs to be cleaved from this, the blog’s name. I can see how the name of the blog created a context for your hypocrisy policing. My apologies.
Fourth, for over two years I have been saying that the employment recovery, post the Great Recession, was going to be rough, and likely very different from that of other recoveries. I think that if you spend some time with the historical postings of the blog you will see that my intuition has been in alignment with future event unfoldment. This is another way of saying that I hope to make you a fan.
Fifth, I recognize and respect the implicit charge of your comment, but reject its context of devisiveness, masquerading as genuine criticism. After all, we are all in this together. This forum is just that – a stage in the round meant to discuss ideas that have the potential to change through cohesion, rather than through division.
Keep them comments comin’!
Jason