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Hospitality Led Job Gains in May

The economy created 559,000 in May, following increases of 278,000 in April and 785,000 in…

  • August 8, 2021

The economy created 559,000 in May, following increases of 278,000 in April and 785,000 in March, according to the U.S. Bureau of Labor Statistics.

May’s job gains came in below the 671,000 expected by economists polled. The unemployment rate declined by 0.3 percentage point to 5.8 percent.

In May, employment in leisure and hospitality increased by 292,000, as pandemic-related restrictions continued to ease in some parts of the country.

Nearly two-thirds of the increase was in food services and drinking places (+186,000). Employment also rose in amusements, gambling, and recreation (+58,000) and in accommodation (+35,000). Employment in leisure and hospitality is down by 2.5 million, or 15.0 percent, from its level in February 2020.

In May, employment increased in public and private education, reflecting the continued resumption of in-person learning and other school-related activities in some parts of the country.

Employment rose by 53,000 in local government education, by 50,000 in state government education, and by 41,000 in private education.

However, employment is down from February 2020 levels in local government education (-556,000), state government education (-244,000), and private education (-293,000).

Construction employment edged down in May (-20,000), reflecting a job loss in nonresidential specialty trade contractors (-17,000). Employment in construction is 225,000 lower than in February 2020.

Unemployment, Labor Force Participation

In May, the unemployment rate declined by 0.3 percentage point to 5.8 percent, and the number of unemployed persons fell by 496,000 to 9.3 million.

These measures are down considerably from their recent highs in April 2020 but remain well above their levels prior to the coronavirus (COVID-19) pandemic (3.5 percent and 5.7 million, respectively, in February 2020).

Among the unemployed, the number of persons on temporary layoff declined by 291,000 to 1.8 million in May.

This measure is down considerably from the recent high of 18.0 million in April 2020 but is 1.1 million higher than in February 2020. The number of permanent job losers decreased by 295,000 to 3.2 million in May but is 1.9 million higher than in February 2020.

In May, the number of persons jobless less than 5 weeks declined by 391,000 to 2 million. The number of long-term unemployed (those jobless for 27 weeks or more) declined by 431,000 to 3.8 million in May but is 2.6 million higher than in February 2020.

These long-term unemployed accounted for 40.9 percent of the total unemployed in May.

The labor force participation rate was little changed at 61.6 percent in May and has remained within a narrow range of 61.4 percent to 61.7 percent since June 2020. The participation rate is 1.7 percentage points lower than in February 2020.

The employment-population ratio, at 58.0 percent, was also little changed in May but is up by 0.6 percentage point since December 2020. However, this measure is 3.1 percentage points below its February 2020 level.

The number of persons employed part time for economic reasons was essentially unchanged at 5.3 million in May but is 873,000 higher than in February 2020.

These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.

In May, the number of persons not in the labor force who currently want a job was essentially unchanged over the month at 6.6 million but is up by 1.6 million since February 2020.

These individuals were not counted as unemployed because they were not actively looking for work during the last four weeks or were unavailable to take a job.

In May, 7.9 million persons reported that they had been unable to work because their employer closed or lost business due to the pandemic–that is, they did not work at all or worked fewer hours at some point in the last 4 weeks due to the pandemic.

This measure is down from 9.4 million in the previous month. Among those who reported in May that they were unable to work because of pandemic-related closures or lost business, 9.3 percent received at least some pay from their employer for the hours not worked, unchanged from the previous month.