IT did its small part for US job creation in May
System designers are in demand
The US economy has now created more jobs than economists had projected for the fourth month in a row, according to the Department of Labor, calling into question the wisdom of those economists as much as the mixed signals coming out of various economic indicators in recent weeks.
The latest jobs report out of the Bureau of Labor Statistics indicates that the economy added 175,000 net new workers in May. That was a tad bit higher than the 169,000 that economists polled by the Wall Street Journal projected, on average.
That's not a big jump over expectations, and the BLS revised the number of jobs created in April down to 149,000 (it was reported as 165,000 last month) and in March to 142,000 (it was originally reported as 138,000). That's a loss of 12,000 jobs in the prior two months, which is not quite balanced by the 6,000 additional jobs that came in above expectations for May.
While adding new jobs is a great thing, and Wall Street is excited about this after a few days of bad economic news that drove the stock markets down, the US economy needs to add around 200,000 jobs per month just to keep up with population growth. It has been a long time since that has happened, and it was not that long ago that the economy was shedding three or four times as many jobs per month during the Great Recession.
The US economy has added an average of 172,000 jobs per month over the past year
From the look of things, the economy may never add 200,000 jobs or more per month again, which means the percentage of the US population that is in the workforce has to be slipping. The precise definition of unemployment –people looking for work who can't find it – is not necessarily the only number that is relevant. People who stop looking for work are, in essence, unpersons as far as these statistics are concerned, and obviously they are still part of the American economy and culture, regardless of what the stats may say or not say about them.
Still, because more people came back into the labor force in May, looking for jobs, the unemployment rate ticked up one-tenth of a point to 7.6 per cent. This rate is calculated based on surveys of American households, not on the employer data gathered by the BLS for its job counts. (This latter data set is called the establishment survey.)
The unemployment rate bumped up a tenth-point in the US in May
Retailers added 28,000 jobs in May, based on seasonally adjusted data provided by the BLS, while organizations that do professional and business services – one of the largest segments of the US economy – added 57,000 workers. Healthcare companies added 11,000 jobs last month. Local, state, and federal government organizations slashed jobs as they have since the beginning of the Great Recession, and shed another 14,000 in May. In the past three months, governments across the spectrum chopped 45,000 employees.
El Reg doesn't trust the seasonally adjusted data, and prefers to look at the raw data to come up with a proxy of sorts for the IT sector, pulling out relevant parts of the establishment data. Although your Reg reporter is no economist, it seems dubious to apply seasonal adjustments based on past historical trends to a current set of data that is more turbulent, as job creation and destruction has been since the Great Recession began in December 2007.
In the manufacturing sector, those making computer and electronic components added 2,500 jobs, rising to 1.08 million workers, and within this area, those making computer and peripheral equipment added 1,000 jobs to 161,200 total employees in the States. Those making communications gear added a measly 100 net new jobs, with 107,300 people now getting paychecks. Semiconductor and electronic component makers added 300 workers, rising to 378,700.
In the information sector, which includes all kinds of publishing and media as well as telecommunications and service bureaus and hosters, telecom companies shed 200 workers, sinking to 855,000, according to the May report from the BLS. And data processing and hosting companies added 800 workers to a pool of 252,000 workers at the end of April.
In the services sector, companies involved with computer systems design and related services had 1.69 million workers, an increase of 8,400 compared to April and up 81,400 workers in the past year – this is one of the hot spots in the economy. Companies in the management and technical services area added 7,700 workers in May, to a pool of 1.17 million employees from April. ®