Reed Reacts to Disappointing Job Gains in May
Washington, DC - The unemployment rate edged down to 4.6 percent in May, and only 75,000 total payroll jobs were created, the Bureau of Labor Statistics reported today. Non-government jobs grew by 67,000. Job creation in March and April was also revised down from earlier estimates."Job creation is slowing in what was already a disappointing economic recovery for many American families," said Sen. Jack Reed (D-RI), Ranking Democrat on the Joint Economic Committee (JEC). "At this point in the last recovery, the economy had created over five million more jobs than we have seen in this recovery, and productivity growth has not translated into higher wages and incomes for most workers. I hope the Presidents Treasury nominee, Henry Paulson, will be an advocate for policies that address the real economic challenges facing American families and not just another salesman for irresponsible tax cuts."Growth in payroll employment has been modest by the standards of most economic recoveries. The 5.3 million jobs created since job losses peaked in August 2003 works out to only 161,000 per monthweak by the standards of past economic recoveries when growth of 200,000 jobs per month or more was typical. Although the unemployment rate has come down, Mays 4.6 percent rate is still higher than the 4 percent rate achieved in the expansion of the 1990s. Most labor market indicators remain weaker than they were at the start of the 2001 recession. The labor force participation rate is 1.1 percentage points lower than it was at the start of the recession and the fraction of the working-age population with a job is 1.3 percentage points lower. Long-term unemployment also persists. Nearly one in every five unemployed people 1.3 million Americans have been jobless for more than 26 weeks, the maximum number of weeks for receiving regular unemployment insurance benefits.Higher prices for gasoline and medical care are squeezing the take home pay of workers. Average hourly earnings were stagnant during 2003 and have fallen during each of the past two years, after adjusting for inflation.Overall, there are 7.0 million unemployed Americans, and 4.7 million additional workers who want a job but are not counted among the unemployed (including about 1.4 million who have searched for work enough to be considered marginally attached to the labor force). An additional 4.1 million people work part-time for economic reasons. The unemployment rate would be 8.2 percent if the figure included those who are marginally attached to the labor force and those who are forced to work part-time for economic reasons.