The American economy lost another 345,000 jobs in May, about half the average monthly decline for the prior 6 months (-643,000), the Bureau of Labor Statistics reported on Friday. While the unemployment rate continued to rise, increasing from 8.9 to 9.4%, its highest rate in a quarter century, the fact that job losses were far smaller than economists had feared and the fewest since September, amplifies hopes of recovery.
From BLS: Manufacturing employment fell by 156,000 in May. Job losses occurred in most component industries. Three durable goods industries–motor vehicles and parts (-30,000), machinery (-26,000), and fabricated metal products (-19,000)–accounted for about half of the overall decline in factory employment. Since its most recent peak in February 2000, employ- ment in motor vehicles and parts has fallen by about 50 percent. Mining shed 11,000 jobs in May, about the same number as in April.
Employment in construction decreased by 59,000 in May, compared with an average monthly job loss of 117,000 in the industry for the previous 6 months. In May, employment fell in nonresidential specialty trade con- tractors (-30,000) and in residential construction of buildings (-11,000).
The change in total nonfarm employment for March was revised from -699,000 to -652,000, and the change for April was revised from -539,000 to -504,000.
Many analysts estimate the economy is currently shrinking at about a 2% pace this quarter, and that the economy could start growing as soon as the third quarter.