May 2015 Jobs Report

Unemployment Rate: 5.5 percent

Unemployed Americans: 8.7 million

Employment and Unemployment

1. The Department of Labor reported an unemployment rate of 5.5 percent for May, an increase of 0.1 percent from April. It reported an increase of 280,000 nonfarm jobs over last month. Employment for March was revised from 85,000 to 119,000 jobs created; and April was revised down from 223,000 to 221,000.   
2. The number of unemployed people in May was 8.7 million, an increase of 125,000 from last month.
3. Unemployment in May among those ages 16-19 was 17.9 percent, up 0.8 percent. Among those 20-24, the unemployment rate was 10.1 percent, up 0.5 percent.
4. The number of long-term unemployed, those unemployed for 27 weeks or more, was 2.5 million, accounting for 28.6 percent of the unemployed. During the 1980s, when our country faced a similar recessionary period, the proportion of long-term unemployed never exceeded 27 percent. 
5. Yesterday, Federal Reserve Governor Daniel Tarullo stated that the U.S economy appears to have “lost some momentum” and may not recover as quickly from a rough first quarter as it did in 2014. The International Monetary Fund also lowered its forecasts for U.S. economic growth. The IMF now expects the U.S. economy to grow 2.5 percent this year, down from an earlier estimate of 3.1 percent in April. 
6. The “real” unemployment or U-6 rate is 10.8 percent, unchanged from April. This is the total percentage of unemployed and underemployed workers.
7. The “real” number of unemployed Americans is 17.3 million. These are people who are unemployed (8.7 million), want work but have stopped searching for a job (1.9 million), or are working part time because they cannot find full time employment (6.7 million).
8. In May, employment grew by 63,000 in professional and business services; 47,000 in health care; 18,000 in government (federal, state and local combined) and 17,000 in construction. Employment in mining fell for the fifth month in a row, with a decline of 17,000; information fell by 3,000; and gasoline stations decreased by 2,000. 

Labor Force Participation

1. The labor force participation rate is 62.9 percent, up 0.1 percentage point from last month and near the lowest level in 36 years. Since April 2014, the participation rate has been stuck in a narrow range of 62.7 and 62.9 percent. Prior to the recession, the rate stood at 66 percent. 
2. If the labor force participation rate were the same as when President Obama took office, the unemployment rate would be 9.6 percent.
3. The share of American adults with jobs in May was 59.4 percent, an increase of 0.4 from last month. This is about four percentage points below its pre-recession peak. 

Wages

1. While the economy has added an average of 254,800 jobs a month over the last 12 months, hiring has failed to translate into wage growth. Average hourly earnings for all employees on private nonfarm payrolls increased by eight cents to $24.96. Over the year, average hourly earnings have risen by only 2.3 percent.
2. May was the 70th straight month that year-over-year hourly wage growth has been below 2.5 percent. Prior to the recession, wage growth routinely exceeded three percent.