Private Sector Job Growth Anemic

Tim Iacono

The Labor Department reported that nonfarm payrolls rose by 431,000 in May, however, a full 411,000 of these jobs were temporary positions for work on the 2010 U.S. Census.

Aside from the high level of government hiring, there were only modest job gains in manufacturing (+29,000), professional and business services (+22,000), and education and healthcare services (+17,000) while construction payrolls tumbled (-35,000).

Total nonfarm payrolls for March were revised lower, from a gain of 230,000 to 208,000, while the April gain of 290,000 saw no revisions, meaning that, when the Census hiring is excluded, nonfarm payrolls were virtually unchanged in this report.

In the household survey, the unemployment rate fell from 9.9 percent to 9.7 percent, however, total employment also fell, down 35,000 to 139.4 million.

Some 322,000 people dropping out of the labor market (i.e., no longer officially counting as “unemployed”) allowed the jobless rate to fall and the broader U6 under-employment rate (including those who have given up looking for work and those settling for part-time work) also fell, from 17.1 percent to 16.6 percent.