US Employment Situation Improved Slightly in May

According to the Bureau of Statistics, total nonfarm payroll employment increased by 175,000 in May (above expectations), and the unemployment rate rose 0.1 pt to 7.6%. The average workweek for all employees on private nonfarm payrolls was unchanged in May (34.5 hours) like average hourly earnings.

From BLS:

 

Total nonfarm payroll employment increased by 175,000 in May, and the unemployment rate was essentially unchanged at 7.6 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in professional and business services, food services and drinking places, and retail trade.

 

The change in total nonfarm payroll employment for March was revised from +138,000 to +142,000, and the change for April was revised from +165,000 to +149,000. With these revisions, employment gains in March and April combined were 12,000 less than previously reported.

 

The average workweek for all employees on private nonfarm payrolls was unchanged in May at 34.5 hours.

 

In May, average hourly earnings for all employees on private nonfarm payrolls, at $23.89, changed little (+1 cent).

 

Both the number of unemployed persons, at 11.8 million, and the unemployment rate, at 7.6 percent, were essentially unchanged in May.

 

In May, the number of long-term unemployed (those jobless for 27 weeks or more) was unchanged at 4.4 million.

 

My view:

 

1/ The momentum is weak and below the threshold of 200 K.

2/ We could also note that unemployment rate rose 0.1% to 7.6% mainly because unemployed people grew from 11.659 K to 11.760 K.

3/ The number of long-term unemployed (those jobless for 27 weeks or more) did not fall.

4/ Wage increases are still limited which means inflationary pressures will remain low in the medium term.

 

These numbers confirm my idea that Fed will not taper its bond-buying program before December.