The May employment report brought some mixed results, with the headline jobs number exceeding expectations, but with revisions to March and April payrolls resulting in a combined decrease of 15,000 jobs. The participation rate and employment population ratio also saw a decrease, while the unemployment rate increased to 4.0%. Despite these fluctuations, there were some positive highlights in specific sectors.
Construction employment saw a significant increase of 21,000 jobs, bringing the total to 613,000 above pre-pandemic levels. Similarly, manufacturing employment increased by 8,000 jobs, now standing at 185,000 above pre-pandemic levels. These gains indicate a steady recovery in these industries post-pandemic.
One key demographic to consider is the prime working age group of 25 to 54 years old. The participation rate for this group increased in May to 83.6%, with the employment population ratio remaining unchanged at 80.8%. Both figures are above pre-pandemic levels and near the highest level seen in this millennium, reflecting a strong labor market for this age group.
Average hourly wages have been a point of interest, with fluctuations seen throughout the pandemic. Wage growth peaked at 5.9% year-over-year in March 2022 but has since trended down to 4.1% year-over-year in May 2024. This data suggests a stabilization in wage growth following the initial impact of the pandemic on lower-paid employees.
Another important metric to consider is the number of people employed part-time for economic reasons. In May, this figure remained relatively stable at 4.4 million individuals. These workers, who would prefer full-time employment, are either working reduced hours or unable to find full-time jobs. While this number decreased slightly from April, it remains slightly above pre-pandemic levels.
The report also highlights the number of workers unemployed for 27 weeks or more. In May, there were 1.350 million workers in this category, up from the previous month. This figure is slightly above pre-pandemic levels but significantly lower than the post-pandemic high seen during the peak of the crisis.
Overall, the employment report indicates positive job growth for 41 consecutive months as of May 2024, marking the current streak as the 5th longest in US history since 1939. Despite some fluctuations in specific metrics, the overall trend suggests a resilient labor market with steady recovery post-pandemic. The data points to a strong foundation for continued economic growth and stability in the coming months.
