The Bureau of Labor Statistics (BLS) reported that nonfarm payroll employment increased by a seasonally adjusted 175,000 during May. Private sector payrolls added 178,000 payroll jobs. The unemployment rate ticked up 0.1 percentage point to 7.6%.
In his press statement, Chairman Brady referred to today’s report as “The Good, the Bad, and the Ugly Employment Report.” Chairmen Brady noted that the good news was that the economy added private sector payroll jobs for the 39th consecutive month. Over the last 39 months the economy private sector payroll employment has risen by 6.5% or 6.9 million (an average of 178,000 jobs per month).
The bad news in today’s report is that the current recovery has produced the equivalent of 4.0 million fewer private sector jobs than the average of other post-World War II recoveries. The average recovery produced an average gain of 10.3% over the comparable 39 months. And there are still 1.9 million or 1.7% fewer private sector payroll jobs than there were in January 2008 when private sector payroll peaked at 115.7 million.
The Really Ugly News in today’s report is that a smaller percentage of adult Americans are employed now (58.6%) than were employed when the recession ended in June 2009 (59.4%). In fact, the employment-to-population has only risen 0.1 percentage point since October 2009 when the unemployment rate peaked at 10.0%.
The labor force participation rate ticked up to 63.4% from 63.3%. These rates remain the lowest seen since the late 1970s. The decline in the labor force participation has been a primary factor in the decline in the official unemployment rate from the October 2009 peak of 10.0%. In fact, if labor force participation had not declined from its January 2009 level of 65.7%, the unemployment rate would be 10.7%.
We often get requests for comparisons of the current recovery with the strong Reagan recovery of the 1980s. The Reagan recovery saw private sector payroll employment grow by 12.9% over a comparable 39 months or the equivalent of 13.8 million private sector payroll jobs. That puts the current recoveries private sector jobs gap compared to the Reagan recovery at 6.8 million.
A brief table is pasted below as a quick reference to information on the growth and jobs gap in this recovery compared to the average of other recoveries and the Reagan recovery.