It’s a promising day for the May jobs report. More jobs were added than economists predicted, unemployment and labor participation levels remained steadily low, and the U.S. economy finally recovered all of the jobs lost during the recession.
From what the Bureau of Labor Statistics is reporting, the economic future bodes well. Even the morning’s stock market trading started off with a bang. Where can we expect to go from here?
Real Signs of Stability
The BLS May jobs report found that 217,000 non-farm payroll jobs were added to the market, slightly outstretching the 215,000 jobs predicted by economists. The whopping 288,000 jobs added in the April jobs report were revised down to 282,000 but the number still remains the highest in months.
Unemployment rates remain at a steady 6.3 percent from the April jobs report. Year over year, national employment numbers have dropped by .6 percent, a trend that portends well for even further decline.
Moreover, the labor force participation rate leveled off after a noticeable increase in April. Currently, it is hovering around 62.8 percent. Whether that’s a temporary reprieve before another drop or the valley before climbing a summit depends on how many jobs are added in the summer months.
Although recent jobs reports haven’t always shown the windfall changes that economists crave, they signify stability that has long been lacking in the job market.
Once again, the information technology sector has remained along a positive vein. Overall, there were an impressive 9,700 payroll jobs added to the market in the BLS report. 6,600 new jobs originated from computer system designs/related services and 3,200 new jobs came from the telecommunications sector. The only discernable decline came from the data processing/hosting sector, where 1,000 jobs were lost from the market. Whether this is an anomaly or the start of an ongoing trend is unclear.
Manufacturing on a whole was positive, but there was a great disparity between durable and non-durable goods. Durable goods manufacturers added 17,000 payroll jobs with the most additions being made in transportation equipment (6,400 jobs), machinery (2,700 jobs), and furniture/related products (1,900 jobs). Nondurable goods took a major hit. Food manufacturing was down 4,900 jobs (potentially influenced by California’s drought) and apparel manufacturing lost 2,300 jobs. However, there seems to be some growth for food and apparel manufacturers in unexpected places like Brooklyn, Raleigh, and Fort Wayne.
Architectural and civil engineering saw overall positive gains in the May jobs report. Heavy and civil engineering added 3,200 new payroll jobs and architectural and engineering services added an additional 4,500 new jobs. The overall total of 7,700 new jobs conveys the increase in construction spending, which has almost reached $1 trillion.
The news for the accounting sector is surprisingly good. According to the BLS, 4,100 new accounting and bookkeeping positions were added to the non-farm payroll between April and May. With the filing deadline for state and federal taxes here and gone, this is an auspicious number of new jobs.
In fact, if you look at the year-over-year change, it’s hard not to be optimistic about the industry – there were 888,300 total jobs in May ’13 compared to 943,900 now. Job fluctuation in recent months (with payroll changes ranging from 15,700 in February to a loss of 100 in March) have made the accounting sector a wild card. Hopefully, this position number will help put that irregularity to rest.
The sectors that make up the light industrial industry also show positive signs of growth. The total number of payroll jobs added is 4,400 – 1,200 jobs coming from the repair and maintenance field and 3,200 from the warehousing and storage field. As manufacturing continues to increase, we can expect some corresponding growth of the light industrial sector along with it.
by James Walsh