The latest jobs report is a total disaster. We got 69,000 new jobs in May which is well below already tepid expectations and is below the labor force trend growth rate. Terrible.
But it gets worse!
“The change in total nonfarm payroll employment for March was revised from +154,000 to +143,000, and the change for April was revised from +115,000 to +77,000.” In other words, we gained 69,000 new jobs in May (estimated) but lost 49,000 in revisions. That leaves us with a net increase in employment of just 20,000. Disaster disaster disaster.
The further internals are not very interesting. Just about everything except health care was flat, as part of the overall flatness. One exception was construction, which fell despite some recent good housing news. That’s because we had substantial drops in “heavy and civil engineering construction” and also in “specialty trade contracts,” which look to me like the fracking boom slowing down. Even more fail as “average workweek for all employees on private nonfarm payrolls edged down by 0.1 hour.” That’s not terrible news on its own, but it further darkens an already bleak picture.
A lot of this is already getting fed through an election-year-politics lens, but it’s important to remember that this is first and foremost a human tragedy for unemployed and underemployed people, and for employed workers who’ve been stripped of bargaining power due to persistent labor market weakness. If growth stays dismal and Barack Obama loses the election, he and Michelle and Jack Lew and Tim Geithner and all the rest will go on to have happy, healthy, prosperous lives. Other people’s careers are much more in the balance. And the responsibility for addressing this crisis lies first and foremost with the Federal Reserve Board of Governors, the one institution in the U.S. government specifically charged with focusing on macroeconomic stabilization. For months now they’ve been dawdling instead of rolling up their sleeves and thinking as hard as they can about what to do to increase demand and employment.