First the numbers:
1) U.S. employers cut 345,000 jobs last month, the fewest since September.
2) Analysts polled by Reuters had forecast non-farm payrolls dropping 520,000 in May.
3) The unemployment rate raced to 9.4 percent, the highest since a matching rate in July 1983, from 8.9 percent in April. The low for this economic cycle was 4.4 percent in march 2007.
4) Since the start of the recession in December 2007, the economy has lost 6.0 million jobs.
5) The number of long-term unemployed (those jobless for 27 weeks or more)
increased by 268,000 over the month to 3.9 million and has tripled since
the start of the recession.
6) A broader measure of unemployment (total unemployed, plus all marginally attached workers plus total employed part time for economic reasons, as a percent of all civilian labor force plus all marginally attached workers) rose to 16.4 percent. The Labor Department has only tracked this number since 1994, but the previous high this decade was 10.4 percent in September 2003.
Now a few thoughts:
1) I am not sure if I am as quite as euphoric as my friend economist Robert Brusca — “Today we have not just ‘Green shoots’ but an authentic sighting of the Jolly Green Giant himself” — but the decline in payroll losses is very good news.
2) I would like to again note that the White House said unemployment would would peak at just below 7 8 percent if its stimulus plan was passed.
3) Those long-term unemployment numbers are bad news for foreclosure rates and credit card defaults.