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May Jobs Report: Job Market Returns to 2008 Peak

Jobs Section of Newspaper

June 10, 2014

The latest jobs report from the Bureau of Labor Statistics showed that the U.S. economy added 217,000 jobs last month. The unemployment rate remained unchanged at 6.3 percent. Even with a stagnant jobless rate, the report marked an important milestone, reported CNN Money: Jobs are finally up to where they were four years ago, just before massive layoffs -- 8.7 million lost jobs over two years -- triggered a 10 percent unemployment rate.

"This is a solid report," Ian Shepherdson, chief economist at Pantheon Macroeconomics, told The New York Times. He said that May marked the fourth consecutive month that employers added more than 200,000 positions. The last time that happened was 14 years ago.

But while some experts celebrated the new report, others remained more guarded. The New York Time noted that the portion of the population in the workforce is stuck at 62.8 percent, a low not seen since the late 1970s. Baby boomers delaying retirement are likely a factor in the trend, reported the Times, but most experts believe that the real culprit is that a substantial number of unemployed Americans have given up searching for a job. Whatever the trend's cause, it spells bad news for recent college graduates and the unemployed.

"We've gotten the unemployment rate down, but are we really creating enough jobs to bring people back into the work force?" Byron Wien, vice chairman of Blackstone Advisory Partners, told The New York Times. "We're not and we need to create more."

Just how many more? Heidi Shierholz, an economist with the Economic Policy Institute, told CNN Money that the economy still needs 7 million new jobs to truly return to a healthy place. Even the White House was quick to note that the economic recovery is still a work in process and incomplete by their standards.

"We're moving in the right direction, but we have a lot more work to do," said Secretary of Labor Tom Perez, as reported by CNN Money. "There are way too many people who are still on the sidelines."

Still, the report does suggest that the economy is moving in the right direction, even if slowly. Scott G. Clemons, chief investment strategist for private banking at Brown Brothers Harriman, told The New York Times that the jobs market may be tepid in terms of overall growth, but it is hot enough to reduce the risk of inflation.

"This is a Goldilocks report," said Clemons."There's been some latent concern about whether we are seeing real strength or just a recovery from the winter, but I think this is for real."


Compiled by Aimee Hosler

Sources:

"217,000 Jobs Added, Nudging Payrolls to Before the Crisis," nytimes.com, June 6, 2014, Nelson D. Schwartz, http://www.nytimes.com/2014/06/07/business/labor-department-releases-jobs-data-for-may.html

"Finally! Job market returns to 2008 peak," money.cnn.com, June 6, 2014, Annalyn Kurtz, http://money.cnn.com/2014/06/06/investing/may-jobs-report/index.html

"The Employment Situation -- May 2014," bls.gov, June 6, 2014, http://www.bls.gov/news.release/pdf/empsit.pdf

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