Unemployment ticks up in May
U.S. employers added 175,000 jobs in May, steady hiring but below the more robust pace that took place during the fall and winter.
The Labor Department says the unemployment rate rose to 7.6 percent from 7.5 percent in April. The increase occurred because more people began looking for work, a good sign.
The government said the economy added 12,000 fewer jobs in April and March.
Employers have added an average of 155,000 jobs in past three months, below the average of 237,000 created from November through February.
The modest gains likely mean the Federal Reserve will continue its bond purchases. The Fed has said it will maintain its pace of bond purchases until the job market improves substantially. The purchases have helped drive down interest rates and boost stock prices.
Some other key features of this recent release from the BLS.
The nation's civilian workforce rose by just under half a million to a little over 155 million. The number of discouraged workers, (people who believe their aren't any jobs out there for then), stayed constant at approximately 780,000.
The number of nonfarm payroll jobs increased by 175,000. Financial journal Bloomberg comments that this could be an indication that:
...companies are looking beyond fiscal restraint...and are optimistic enough about prospects for demand in the second half of the year.
Federal government employment has contracted by 45,000 over the past three months.
Employment growth areas include healthcare (+11,000), retail (+28,000) and leisure and hospitality (+38,000). Leisure and hospitality has added 337,000 positions over the past year.
The full details of the release are here.
The economy "is creating jobs at a reasonable rate,'' Chris Williamson, chief economist with the financial research firm Markit, said in a note to clients. But he said the Fed will want to see lower unemployment before it considers scaling back its $85 billion-a-month bond-buying program.
Job growth has been steady this year, despite higher taxes and federal spending cuts. Still, some signs in the report suggested that the spending cuts and weaker global growth are weighing on the job market.
Manufacturers cut 8,000 jobs, and the federal government shed 14,000. Both were the third straight month of cuts for those industries.
The economy grew at a solid annual rate of 2.4 percent in the first three months of the year. Consumer spending rose at the fastest pace in more than two years. But economists worry that the steep government spending cuts and higher Social Security taxes might be slowing growth in the April-June quarter to an annual rate of 2 percent or less.