June 1, 2012
LIA Monthly Economic Report - Slow growth for jobs and the economy
By: Dr. Pearl M. Kamer, LIA Chief Economist
U.S. job growth continues to be disappointing. However, April manufacturing activity grew at the fastest pace in almost a year. Moreover, after six consecutive years of home price declines, there are signs that more U.S. housing markets are
bottoming out and beginning to stabilize.
U.S. job growth slowed further in May, igniting fears that the economy is again poised for a slowdown. Employers added only 69,000 payroll jobs in May and the unemployment rate bounced back to 8.2%. Currently, 13.7 million workers remain jobless and the average duration of unemployment is about 39.1 weeks. The share of working?age Americans who are either working or actively looking for work is currently 63.6%, the lowest rate of labor force participation since
1981. Working men have been particularly hard hit by the recent recession. Their labor force participation rate fell to 70% in April, the lowest ratio since the Labor Department began collecting such information in 1948. It is noteworthy that the preliminary February and March employment numbers have since been revised upward, creating some hope that the April jobs report may not be as bleak as it seems. Nevertheless, the lackluster pace of job growth is worrisome. The U.S. economy must create at least 125,000 jobs monthly just to keep pace with labor force growth. It requires at least 250,000 new jobs per month for a sustained period to lower the unemployment rate. At the current pace, it will take more than two more years for the U.S. to return to the employment level attained prior to the recent recession.
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