June 5, 2020
Total nonfarm payroll employment increased by 2.5 million in May, as the rate of unemployment decreased to 13.3%, according to a report by the U.S. Bureau of Labour Statistics (BLS). This improvement was attributable to a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus (COVID-19) pandemic and efforts to contain it. BLS mentioned that, “rose sharply in leisure and hospitality, construction, education and health services, and retail trade. By contrast, employment in government continued to decline sharply.”
Leisure and hospitality increased by 1.2 million in May 2020. Almost half of the gain in total nonfarm employment occurred in the food services and drinking places which rose by 1.4 million. However, employment in the accommodation industry declined in May by 148,000 jobs. Employment in construction rose by 464,000 in May. Notably, employment in education and health services climbed by 424,000 jobs in May. Employment in health care rose by 312,000, private education increased by 33,000 and social assistance rose by 78,000 jobs over the month. Whereas, employment in professional and business services added 127,000 jobs, retail trade went up by 368,000 jobs, manufacturing increased by 225,000 jobs while other services rose by 272,000 jobs in May. Employment in financial activities increased by 33,000 jobs and wholesale trade (21,000). Whereas, government employment decreased by 585,000 jobs in May, employment in transportation, and warehousing (-19,000), mining lost 20,000 jobs and information lost 38,000 jobs.
Notably, BLS stated, “the number of unemployed persons who were on temporary layoff decreased by 2.7 million in May to 15.3 million, following a sharp increase of 16.2 million in April. Among those not on temporary layoff, the number of permanent job losers continued to rise, increasing by 295,000 in May to 2.3 million.”
In May, the number of unemployed persons decreased by 2.1 million to 21.0 million, while the number of long-term unemployed (those jobless for 27 weeks or more) increased by 225,000 to 1.2 million. Notably, the total number of persons classified as long-term unemployed, accounted for 5.6% of the unemployed. However, number of unemployed persons who were jobless less than 5 weeks decreased by 10.4 million in May to 3.9 million.
The labour force participation rate for May rose by 0.6 percentage point to 60.8%, while the employment population ratio increased 1.5 percentage points to 52.8%. In May, the number of persons who usually work full time climbed by 2.2 million to 116.5 million, and the number of persons who usually work part time rose by 1.6 million to 20.7 million. Part-time workers accounted for about two-fifths of the over-the-month employment growth. Nonetheless, persons employed part time for economic reasons stood at 10.6 million in May. Based on BLS assessment, “these individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.”
In May, a total of 2.4 million individuals were slightly attached to the labour force. These persons were not in the labour force, wanted and were available for work, and had looked for a job in the last year. Of the marginally attached, 662,000 persons were classified as discouraged workers in May, little changed over the month. These persons are not currently seeking for work as they believe no jobs are available for them.
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