ThinkWhy, a SaaS company helping businesses navigate the labor market, has released its U.S. monthly jobs report for May 2020. According to the Bureau of Labor Statistics (BLS), the U.S. economy gained 2.5 million jobs in May, more than twice the previous record monthly gain of 1.1 million jobs in September 1983.
As reported monthly through the BLS, the U.S. unemployment rate for May fell to 13.3 percent. However, the May 2020 survey reference week for the BLS household survey is May 12-18. Coupling today’s BLS unemployment data with the 4.0 million initial claims reported through the weeks ending May 23 and May 30, ThinkWhy estimates unemployment ranges between 13.3 percent and 23.1 percent.
“May’s record job gain of 2.5 million strongly suggests that an economic recovery is underway, particularly for some of the nation’s hardest hit businesses such as restaurants, construction, and segments of healthcare. With more states reopening and consumer mobility increasing, June will be a pivotal month for the breadth and sustainability of the rebound,” says Jay Denton, SVP, Business Intelligence and Chief Innovation Officer at ThinkWhy.
Labor Market Performance:
- Non-farm payrolls increased 2.5 million in May
- Unemployment sits at 13.3%
- Labor force participation increased to 60.8%
- Leisure and Hospitality gained 1.2 million jobs after losing 8.2 million jobs in March and April
- Combined March and April revisions were down by 642,000 jobs
In addition, total nonfarm payroll average hourly earnings increased by 6.7% year-over-year ending in May, possibly reflecting the widespread loss of lower-wage jobs. Combined with two consecutive weeks of generally decelerating continuing claims, these are indications the U.S. is seeing signs of recovery.
Why It Matters: Key Takeaways from the May Employment Report
May’s historic turnaround signals the economic recovery has begun, but the road to full recovery will undoubtedly be long. For businesses looking to grow and ensure they stand the best chance of a successful recovery, it comes down to planning and execution. Identification and research of potential opportunities requires capital, effort and resources. Many companies rightly continue to keep a tightened rein on all three.
As businesses navigate recovery, they can:
- Focus on cashflow, recruitment and market expansion. Ensure there are significant resources to allow for continued potential dips.
- Explore the specifics of your industry and metro area as these will play heavily into the speed of recovery for your business.
- Consider upskilling and cross-skilling practices to bolster new talent acquisition initiatives as the recovery phases progress.
- Reevaluate your people strategies as you benchmark salaries throughout organizations and locations.
- Leisure and Hospitality: Job gain within this industry in May was 1.2 million, of which 1.4 million were in food services and drinking places. This gain was offset by employment in the Accommodations industry, which lost 148,000 jobs.
- Trade, Transportation and Utilities: Gain within this industry was 368,000 jobs, compared to a loss of 3.2 million jobs in the sector in April.
- Education and Health Care Services: Gain within this industry was 424,000 jobs. In Healthcare, jobs rose by 312,000, including a gain of 245,000 in dental offices.
- Professional and Business Services: Gain within this industry was 127,000 jobs, after a loss of 2.2 million jobs in April.
- Manufacturing: Gain within this industry was 225,000 jobs, after a loss of 1.3 million jobs in April.
- Government: This industry lost 585,000 jobs, down from April’s loss of 963,000 jobs. Most of the May job loss was in local government, which shed 487,000 jobs.
To read the full report, click here.
ThinkWhy continuously monitors and forecasts labor data at all levels, measuring impact to MSAs and businesses across the country, to support organizations and provide insights during the economic downturn as well as the recovery phase. LaborIQ® by ThinkWhy® is a proprietary labor market reporting platform is currently available for all U.S. organizations. For additional information on LaborIQ, please visit ThinkWhy.com.
ThinkWhy is helping companies navigate a new era of work by creating modern, human-centered software that supports better career lives. ThinkWhy’s flagship product, LaborIQ™, is the first platform to bridge the gap between market analysis and salary answers, delivering a strategic advantage to businesses. Learn more at www.ThinkWhy.com or follow us on Twitter and Instagram at @ThinkWhy_, on Facebook at @ThinkWhyLLC and LinkedIn at @ThinkWhy-LLC.