UNEMPLOYMENT RATE CLIMBS, BUT RATE SLOWS…. There was a point, not too terribly long ago, that 345,000 losses in a single month would be seen as awful. But in the context of this recession, it’s seen as something of an improvement.
The United States economy lost 345,000 jobs in May, the government reported on Friday, a sharp slowing in the pace of job losses that fueled hopes that the economy was on its way toward a recovery.
The recession continued to take a toll as the unemployment rate climbed to 9.4 percent, its highest point in a quarter-century. Economists said the job losses were likely to pile up through the rest of the year as the country’s labor market bottomed out. But they saw the latest figures as solid evidence the job market was no longer in a free fall.
In normal times, the loss of so many jobs in a single month would have been interpreted as a calamity. But 18 months into the longest recession since the 1930s, economists said the milder pace of job losses indicated that the economy was gradually leveling off as government stimulus money trickled out and businesses reined in their budgets and payrolls. “Things are still getting worse, but the pace of decline has slowed down,” said David Wyss, chief economist at Standard & Poor’s. “Overall, it’s not quite as dire as it looked in the first quarter.”
The 345,000 job losses amounted to the best month for the U.S. economy since September 2008.
Some reports indicated this morning, before the May numbers were released, that forecasts expected 520,000 job losses in May, and that would have been a sign of slight progress. With that in mind, 345,000 losses in May is obviously more encouraging.
But that’s cold comfort to those who continue to struggle with a bleak job market. With the new numbers in mind, 6 million Americans have lost their jobs since the start of the recession in December 2007.
What’s more, the 9.4% unemployment rate climbs to 16.4% if we include those who are working part-time but want full-time employment, or those who’ve simply given up. This number, often referred to as the U6 measure, continues to be at its highest point since the government began keeping track in 1994.