May Jobs Report: One Milestone (Maybe) and a Whole Lot of Status Quo

The latest American employment stats are out, with the Bureau of Labor Statistics (BLS) announcing Friday that May saw some 217,000 non-farm jobs added, slightly exceeding economists' expectations. But the unemployment rate remained unchanged at 6.3 percent, or about 9.8 million jobless Americans. 

On the new jobs front, employment increased in professional and business services (+55,000 jobs), health care and social assistance (+55,000), food services (+32,000), and transportation and warehousing (16,000). The manufacturing sector had a stronger showing than usual, adding some 10,000 new jobs last month. 

All in all, more Americans went to work in May than ever before. An additional 217,000 payroll jobs pushes U.S. employment to 138.5 million—a record high.

The last time America was so thoroughly employed was in the halcyon days of early 2008, before the recession really had its way with us. But "although an important milestone, Friday's record high number of jobs does not represent anything like a healthy U.S. labor market," The Washington Examiner 's Joseph Lawler cautions.

The U.S. remains 7.1 million short of the number of jobs it would have if employment kept up with population growth, according to the left-leaning Economic Policy Institute's analysis. The nonpartisan Congressional Budget Office's more conservative estimate places that number at 5.5-6 million.

Interestingly, the new BLS job numbers are at odds with labor statistics reported Wednesday by payroll company Automatic Data Processing (ADP). ADP publishes a monthly jobs snapshot based on actual transactional payroll data.

According to ADP's figures, the private sector added only 179,000 jobs in May, quite a bit less than by Uncle Sam's count. What gives?

"The ADP employment report provides a very tight correlation with the BLS's revised payroll numbers," writes financial analyst Brent Nyitray at MarketRealist.com. 

The BLS revises its payroll data twice, and the ADP number comes out before the first estimate. The BLS's first estimate is based on roughly 70% of the establishments sampled. The second revision includes another 20% and the final revision adds another 4%. Since ADP's numbers are based on live payroll data, they're more accurate than the BLS's first pass at the numbers.

Looks like our "record employment" excitement may be short-lived… and that just leaves us with May's status quo unemployment rates. Across work groups, the unemployment rates showed little or no change, holding relatively steady at 5.9 percent for adult men, 5.7 percent for adult women, 5.4 percent for whites, 11.5 percent for blacks, 7.7 percent for Hispanics, and 5.3 percent for Asians. The number of long-term unemployed—those jobless for 27 weeks or more—was also essentially unchanged (at 3.4 million), as was the number of "involuntary part-time" employees.