The latest monthly jobs report has disappointed once again — but economists aren’t sounding the alarm just yet.
According to the Bureau of Labor Statistics, total nonfarm payrolls grew by 559,000 in May, with notable job gains in the leisure and hospitality, public and private education, as well as health care and social assistance sectors. However, the figures were short of economists’ expectations of an increase of 671,000 jobs.
The report came a month after the agency released April’s numbers, which fell largely short of projections. The upwardly revised 278,000 was still well below the initial estimate of 1 million jobs.
Still, major benchmark indices — the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — were in the green following the release of the report. Investors appeared undeterred by the miss, particularly as a rapid COVID-19 vaccine rollout and reopening of businesses have charted a path to progress — albeit slow and steady — for the United States economy.
As for retail, the sector saw a slight drop of 5,800 jobs last month. While warehouse clubs and supercenters as well as sporting goods and hobby stores logged respective declines of 4,700 and 1,900, the industry recorded advancements in clothing and clothing accessories stores (+10,500), miscellaneous store retailers (+6,000), department stores (+5,500) and nonstore retailers (+3,100).
What’s more, the unemployment rate as a whole declined to 5.8% from 6.1% — better than the estimated 5.9% — while the total number of unemployed people decreased by 496,000 to 9.3 million.
Yesterday, the ADP National Employment Report — a precursor to the government’s monthly jobs numbers — showed that job growth advanced at its greatest pace in nearly a year amid the exit from the pandemic. It found that total nonfarm private employment rose by 978,000 jobs in May — a sizable boost from the 654,000 recorded in April and the biggest jump since employers added 4.35 million jobs last year in June at a time when the country ushered in its first wave of reopenings.
That said, some companies have been challenged in the recruitment and retention of workers. Exacerbated by the global health crisis, a few factors are at play: the fear of contracting COVID-19, limited in-classroom learning and day-care capacities, a drop-off in production levels attributed to supply chain disruptions and even additional jobless checks from the federal government.