Make us your home page
Instagram

U.S. employers add 175,000 jobs; unemployment rate up to 7.6%

Job seeker Craig Cline of Lincolnwood, Ill., right, meets with Jeremy Skeeters, left, and Lindy Hammel of Aflac Insurance Co. during a career fair in Rolling Meadows, Ill., last month. 

Associated Press

Job seeker Craig Cline of Lincolnwood, Ill., right, meets with Jeremy Skeeters, left, and Lindy Hammel of Aflac Insurance Co. during a career fair in Rolling Meadows, Ill., last month. 

WASHINGTON — More Americans hunted for jobs in May, and more companies filled them — signs of confidence and resilience for the slow-healing U.S. economy.

The 175,000 jobs that employers added last month were the latest evidence that the economy could be poised for stronger growth in coming months, despite tax increases and government spending cuts.

The unemployment rate rose to 7.6 percent from 7.5 percent in April, the Labor Department said Friday. But that increase was only because more people began looking for work, a healthy sign. About three-quarters of them found jobs.

Investors seemed pleased that the report hit a sweet spot: The job growth showed the U.S. economy's sturdiness. Yet the gain was modest enough that many analysts think the Federal Reserve will continue making bond purchases intended to stimulate growth for at least several more months. The purchases have eased long-term loan rates and lifted stock prices.

The Dow Jones Industrial Average surged more than 200 points.

"Job growth is still a bit weaker than desired," said Russell Price, an economist at Ameriprise Financial. But the steadiness of the job gains "is a testament to the economy's much improved underlying fundamentals."

The housing market is strengthening, auto sales are up and consumer confidence has reached a five-year peak. Stock prices are near record highs, and the budget deficit has shrunk.

U.S. employers have added an average of 155,000 jobs in the past three months. But the May gain almost exactly matched the average increase of the previous 12 months: 172,000.

Reflecting a recent trend, many of the jobs added in May were lower-paying ones, which aren't likely to fuel as much consumer spending and economic growth as higher-paying jobs that have disappeared.

Yet many Americans appear more optimistic about their job prospects: 420,000 people started looking for work in May. As a result, the percentage of Americans 16 and older either working or looking for work rose to 63.4 percent from a 34-year low of 63.3 percent in April.

This is called the labor force participation rate. Higher participation can raise the unemployment rate. That's because once people without a job start looking for one, they're counted as unemployed.

Labor force participation has been falling since peaking at 67.3 percent in 2000. That's partly the result of baby boomers' retiring and dropping out of the workforce.

Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities, thinks an improving job market will lead more Americans to seek jobs. He predicts that the participation rate will level off around 63.5 percent.

The unemployment rate is derived from a survey of households, which found that more people started looking for work in May. Because some didn't find jobs right away, the number of unemployed rose 101,000 to 11.7 million.

The job gain for the month is calculated from a separate survey of employers.

Manufacturers cut 8,000 jobs. The federal government shed 14,000. Both were the third straight month of cuts for those industries. Over the past three months, the federal government has cut 45,000 jobs.

The number of temporary jobs rose by about 26,000. The economy has added temporary jobs for eight straight months, suggesting that employers are responding to more demand but aren't confident enough to hire permanent workers.

Industries that rely directly on consumer spending hired at a healthy pace — a sign of confidence that consumers will keep spending. Retailers added 28,000 jobs. Restaurants added 38,000.

Those categories include many lower-paying occupations. By contrast, the recession sharply cut jobs in higher-paying industries such as manufacturing, construction and finance, which have yet to recover.

Mark Vitner, an economist at Wells Fargo, calculated that about 60 percent of the jobs created in May were in lower-paying fields. Even in a professional field such as health care, one of the biggest job creators was home health care services, where care providers earn about $10 an hour, according to government data, he said.

"It's hard to get meaningful income growth with these types of jobs," Vitner said.

Employment gains, losses

Professional/business services: + 57,000

Leisure and hospitality: +43,000

Retail: +27,700

Temporary help services: +25,600

Health care: +10,700

Construction: +7,000

Financial services: +4,000

Transportation and warehousing: – 3,900

Manufacturing: – 8,000

Source: McClatchy Newspapers

U.S. employers add 175,000 jobs; unemployment rate up to 7.6% 06/07/13 [Last modified: Friday, June 7, 2013 10:18pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Pinellas licensing board asks Sen. Jack Latvala for $500,000 loan

    Local Government

    The troubled Pinellas County agency that regulates contractors wants Sen. Jack Latvala to help it get a $500,000 lifeline from the state to stay afloat.

    State Sen . Jack Latvala, R- Clearwater, is being asked to help the Pinellas County Construction Licensing Board get $500,000 from the state so it can stay open beyond February.  [SCOTT KEELER   |   Times]
  2. In advertising, marketing diversity needs a boost in Tampa Bay, nationally

    Business

    TAMPA — Trimeka Benjamin was focused on a career in broadcast journalism when she entered Bethune-Cookman University.

    From left, Swim Digital marketing owner Trimeka Benjamin discusses the broad lack of diversity in advertising and marketing with 22 Squared copywriter Luke Sokolewicz, University of Tampa advertising/PR professor Jennifer Whelihan, Rumbo creative director George Zwierko and Nancy Vaughn of the White Book Agency. The group recently met at The Bunker in Ybor City.
  3. Tampa Club president seeks assessment fee from members

    News

    TAMPA — The president of the Tampa Club said he asked members last month to pay an additional assessment fee to provide "additional revenue." However, Ron Licata said Friday that the downtown business group is not in a dire financial situation.

    Ron Licata, president of the Tampa Club in downtown Tampa. [Tampa Club]
  4. Under Republican health care bill, Florida must make up $7.5 billion

    Markets

    If a Senate bill called the Better Care Reconciliation Act of 2017 becomes law, Florida's government would need to make up about $7.5 billion to maintain its current health care system. The bill, which is one of the Republican Party's long-promised answers to the Affordable Care Act imposes a cap on funding per enrollee …

    Florida would need to cover $7.5 billion to keep its health care program under the Republican-proposed Better Care Reconciliation Act of 2017.  [Times file photo]
  5. Amid U.S. real estate buying binge by foreign investors, Florida remains first choice

    Real Estate

    Foreign investment in U.S. residential real estate recently skyrocketed to a new high with nearly half of all foreign sales happening in Florida, California and Texas.

    A National Association of Realtors annual survey found record volume and activity by foreign buyers of U.S. real estate. Florida had the highest foreign investment activity, followed by California and Texas. [National Association of Realtors]