The Labor Department said today that the U.S. economy added only 38,000 jobs in May, the fewest since September 2010, but the jobless rate nonetheless fell to 4.7 percent, partly because of people dropping out of the labor force.
The government also revised downward its job figures for March and April by a total of 59,000. The March total fell to 186,000 and the April figure to 123,000.
The New York Times reported that the slowdown could cause the Federal Reserve to delay a decision to raise interest rates. Recent strengthening economic indicators in areas such as the housing market had been seen as setting the conditions for a rate hike, possibly as early as this month.
“Boy, this is ugly,” Diane Swonk, an independent economist in Chicago, told the Times. “The losses were deeper and more broad-based than we expected, and with the downward revision to previous months, it puts the Fed back on pause.”
About 35,000 workers at Verizon were on strike and not on the company’s payroll in May, the government said. That affected the job totals for the month. The Verizon workers returned to their jobs this week.
Health care added 46,000 jobs in May. In the manufacturing sector, employment in durable goods declined by 18,000 in May, the government said, with job losses of 7,000 in machinery and 3,000 in furniture and related products.
Employment in other major industries, including construction; wholesale trade; retail trade; transportation and warehousing; financial activities; leisure and hospitality; and government changed little during the month.
The department said the number of long-term unemployed — people who have been jobless for 27 weeks or more — declined by 178,000 to 1.9 million in May. Those people accounted for 25.1 percent of the unemployed.
The number of people who have been unemployed for less than five weeks decreased by 338,000 to 2.2 million.
The civilian labor force participation rate decreased by 0.2 percentage points in May to 62.6 percent. The rate has declined by 0.4 percentage points during the last two months, offsetting gains in the first quarter.
The number of people employed part time for economic reasons (also referred to as involuntary part-time workers) increased by 468,000 to 6.4 million in May after showing little movement since November. Those people, who would have preferred full-time employment, were working part time because their hours had been cut or because they were unable to find a full-time job.
A total of 1.7 million people were marginally attached to the labor force in May, little changed from a year earlier. (The data are not seasonally adjusted.) Those people were not in the labor force, wanted and were available for work and had looked for a job sometime during the prior 12 months. They were not counted as unemployed because they had not searched for work in the four weeks that preceded the survey.