The incredible May jobs report reflects President Trump’s commitment to bring American’s back to work and restore confidence in the economy. Payroll employment rose by 2.5 million in May, the greatest number of jobs created in a single month ever recorded. Additionally, the official unemployment rate decreased to 13.3%.
May Employment Situation Report
Our Economy is beginning to Rebound Earlier than Expected
· The May employment situation reflects a sharp improvement in the labor market as states begin to reopen. Because payroll employment is measured as of the pay period that includes the 12th of the month, the May report now reflects labor market impacts of COVID-19 and responses to it.
· The U.S. economy added 2.5 million jobs in May and the unemployment rate fell from 14.7 percent to 13.3 percent.
o Employment increased significantly in leisure and hospitality (1.2 million), construction (464,000), education and health services (424,000), retail trade (368,000), and manufacturing (225,000).
· These job gains surprised forecasters, given many States were only beginning to reopen their economies during reports’ reference periods (the week/pay period that includes May 12).
o The median of all private-sector forecasts predicted 7.5 million job losses in May and an unemployment rate of 19.2 percent.
o The economy beating expectations by 10 million jobs (more than Michigan’s population) and the unemployment rate falling instead of rising show that the transition back to strong economic growth began earlier than many expected.
· The official unemployment rate (U-3) declined 1.4 percentage points to 13.3 percent in May. This shows a shocking turnaround as forecasts estimated the unemployment rate to rise to 19.2 percent last month.
o In May, the number of unemployed persons decreased by 2.1 million, after April’s increase of 15.9 million.
o In May, unemployed individuals who reported being on temporary layoff decreased by 2.7 million to 15.3 million. This is the second largest monthly change since the series began in 1967. Unemployed individuals not on temporary layoff increased by 385,000 to 2.9 million
Laid Off Workers Remain Attached to Their Jobs
· There were 15.3 million people on temporary layoff in May, in addition to an estimated 4.9 million people who had temporarily lost their jobs but were counted as employed but “not at work for other reasons.”
o Including all those who were potentially on temporary layoff, 78.2 percent of unemployed persons in May were on temporary layoff—well above the 13.3 percent average over the 12 months before this March.
· This provides reason to believe these temporarily laid off workers could return to their previous jobs as States continue reopening and economic activity picks up.
o These employment connections deteriorate the longer that States limit economic activity, so it is critical to continue focusing on reviving the health of America’s labor force.
· May’s labor market flows show that there was not an elevated level of workers dropping out of the labor force directly.
o Flows from employment to not in the labor force were 4.4 million from April to May, in line with the average over the 12 months before this March (4.7 million).
Job Gains Are Poised to Grow in June
· Another sign that job growth will continue is May’s jump in average weekly hours, as increasing hours can be a sign that employers need to hire more workers to meet demand.
o For all private sector employees, average weekly hours increased by 0.5 to 34.7 hours—the highest level since the series began in 2006.
o For production and non-supervisory employees, this measure increased by 0.6 to 34.1 hours—the highest level in 19 years.
· 73 percent of small businesses are now open—up from the pandemic-low of just 52 percent right before the April jobs report’s reference periods.
o Workplace visits are up roughly 40 percent from its pandemic-low.
Thank you very much, for all your prayers during this time. Please feel free to share any statements or comments.
Best,
Amanda Robbins
Associate Director
White House Office of Public Liaison