May Employment

The headline numbers from the BLS' May employment report are disappointing.  Employment only rose by 69,000, which is short of the rate needed to keep pace with population growth and technological progress, and the unemployment rate ticked up to 8.2%.

For reactions, see the Times' David Leonhardt, Free Exchange's Ryan Avent, Mark Thoma and Calculated Risk.

Although the payroll employment number rightly gets higher billing because it comes from a survey of businesses which has a larger sample, its worth noting that the numbers from the survey of households were a bit more encouraging.  According to the household survey, 422,000 more people were employed in May than April, and the reason the unemployment rate rose is that there was an even bigger increase in the labor force, partly reversing the decline in labor force participation. 

On a non-seasonally adjusted basis, the unemployment rate in May was 7.9%, up from 7.7% in April, and employment rose by 789,000.  That is, May is normally a month with big jumps in both employment and the labor force, which are removed by the seasonal adjustment.