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May U.S. jobs report stuns with gain of 2.5 million jobs and drop in jobless rate

By Adam Rombel (arombel@cnybj.com)

Date:

A construction project underway in the town of Camillus. Construction employment increased nationally by 464,000 in May, gaining back almost half of April’s decline of 995,000 jobs, the U.S. Bureau of Labor Statistics reported Friday. (Photo credit: zoeyadvertising.com)

The U.S. economy surprisingly added 2.5 million jobs in May and the unemployment rate fell to 13.3 percent from 14.7 percent in April May as the nation emerges from the coronavirus pandemic slowdown, the U.S. Bureau of Labor Statistics (BLS) reported Friday.

Economists had been expecting a loss of 7.5 million jobs in May with the unemployment rate rising to close to 20 percent. That didn’t happen.

The report indicates businesses are rehiring their workers sooner than expected as states gradually reopen their economies from virus-induced shutdowns.

“These improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus (COVID-19) pandemic and efforts to contain it,” the BLS said in its summary.

The U.S. economy lost 20.7 million jobs in April and 1.4 million positions in March, per the bureau.

In May, employment in leisure and hospitality, the industry hit hardest by the pandemic, increased by 1.2 million, following losses of 7.5 million jobs in April and 743,000 positions in March. Employment in food services and drinking establishments rose by 1.4 million, following steep declines in April and March (a loss of 6.1 million jobs combined).

Construction employment increased by 464,000 in May, as that sector gained back almost half of April’s decline of 995,000 jobs, the BLS said. Much of the increase occurred in specialty trade contractors (325,000 positions added), with growth about equally split between the residential and nonresidential components. Jobs were also added in the construction of buildings (+105,000), mostly in residential building.

Employment increased by 424,000 in education and health services in May, after a drop of 2.6 million in April. Health-care employment increased by 312,000 over the month, with gains in dental offices (+245,000), offices of other health practitioners (+73,000), and offices of physicians (+51,000). Elsewhere in health care, nursing and residential-care facilities (-37,000) and hospitals (-27,000) continued to shed jobs. Employment increased in the social assistance industry (+78,000), the BLS said.

In May, manufacturing employment rose by 225,000, with gains about evenly split between the durable and nondurable goods components. This followed April’s drop in manufacturing employment of 1.3 million jobs.

New York’s job situation

The New York Department of Labor will release its May jobs report in a couple of weeks, providing a window into where the Empire State’s economy stood in the month.

As the state with the most coronavirus cases and deaths in the nation, New York’s economic reopening has been slower than most states. Only upstate New York regions began to significantly reopen in May, starting in the middle of the month and picking up more speed in the month’s final days.

In April, New York’s economy lost more than 1.8 million jobs, with the unemployment rate soaring to 14.5 percent from 4.1 percent in March.

 

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