Another positive jobs report was released earlier this morning, following a disappointing April. Continuing its long journey to a full pre-pandemic recovery, the U.S. economy saw the unemployment rate fall once again in May, from 6.1% to 5.8%. Employers also added 559,000 jobs to the economy, especially in the areas of leisure & hospitality, education, and healthcare. These numbers are good, despite economists hoping for higher (they anticipated gains of 671,000). However, with the economy experiencing back to back months of slow improvement, time will tell what this will mean for employment in the months to come.
Most of the 559,000 jobs added to the U.S. economy were seen in leisure & hospitality, as was true in April, while the industry continues to make a comeback from low 2020 employment.
Leisure & hospitality employment increased by 292,000. Food services & drinking places made up most of those gains (186,000), with amusement, gambling, and recreation also growing significantly (58,000). This industry's employment is still down 2.5 million (15%) from February of 2020.
Local government education employment increased by 53,000, while state government education grew by 50,000 and private education by 41,000.
Employment in healthcare & social assistance rose by 46,000, with ambulatory healthcare services employment on the rise and childcare continuing to recover.
Manufacturing employment increased by 23,000 and motor vehicles and parts saw job gains of 25,000 following a loss in April.
Other industries such as transportation & warehousing, wholesale trade, and professional & business services saw small gains in May.
Some of the job gains seen in May were offset by losses in other industries, although this month, thankfully, the list is shorter than usual.
Construction employment declined by 20,000, which the BLS attributes to a job loss in nonresidential speciality trade contractors. This is the second month in a row that job numbers have fallen in this sector.
Employment in retail decreased slightly, down 6,000 in May, with food and beverage store jobs decreasing by 26,000.
Employment remained largely unchanged for the industries of mining and financial activities.
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Other employment statistics for May
This month's household survey data showed that:
16.6 percent of employed people worked from home in some fashion due to the pandemic, down slightly from April (following a consistent decline in the past few months).
7.9 million people reported that they had been unable to work because their employer closed or lost business due to the pandemic. Though that number is significantly lower than April's, only 9.3% received some pay from employers for the hours they couldn't work, unchanged from last month.
The number of people not in the labor force in May who were prevented from looking for work due to the pandemic fell to 2.5 million, although some wonder if these potential job seekers are holding out for better conditions and higher wages before re-entering the workforce.
Economists had a slightly higher estimate for May's numbers, but seeing as they're better than April's and continuing the positive trend we've been seeing for months, the economy is not in bad shape overall. It's been over a year since the pandemic started and we are getting significantly closer to bridging the gap between pre-pandemic and present levels.
Talroo will continue to monitor the state of the U.S. economy, how job seekers are feeling, and what employers can do to hire better across industries. Read more of our research, resources, and reflections over the past year or reach out to us to learn more.