The economy gained 280,000 jobs in May, with the official unemployment rate unchanged at 5.5 percent, according to the Bureau of Labor Statistics.
The private sector now has added more than 12 million jobs over 63 straight months of job growth, the longest streak on record. Jobs growth slowed in the first quarter but has bounced back in April and May. Over the past three months, it has averaged about 207,000 a month.
The official recovery continues into its sixth year, but still has a long way to go. Over 17 million people are still in need of full-time work. The long-term unemployed (jobless for 27 weeks or more) remain a troubling 28.6 percent of the unemployed, still near the highest pre-recession levels on record. The employment population ratio – the percentage of the eligible population that is employed – remains at 59.4 percent. The labor force participation rate remains at lows not seen since before women entered the workforce in the 1970s.
This is reflected in the slow growth of wages. Average hourly wages have risen only 2.3 percent over the last year. Workers are still struggling to share in the rewards of growth. The supply of workers still exceeds the demand for them.
Growth continues in lower-wage job categories like temporary services, leisure and hospitality. Employers are gearing up for the summer vacation season. Health care and construction jobs were also up. Manufacturing showed no gains; mining continued to decline.
The continued progress on jobs is likely to add to the barking of the Wall Street inflationistas urging the Federal Reserve to raise interest rates. But the Fed would do better to follow the cautions of the International Monetary Fund, hardly a liberal bastion. In its annual review of the U.S. economy, the Fund issued an unusually direct warning about the dangers of raising rates too soon, suggesting that the Fed hold off until 2016.
It also scolded the U.S. for a perverse fiscal policy that is fixated on deficit reduction at the expense of essential investments in infrastructure and elsewhere. Even the IMF concludes that more spending on rebuilding its decrepit infrastructure, on education and research and development would boost growth, enhance productivity and create jobs. Under chair Janet Yellen, the Fed seems attuned to the Fund’s cautions on monetary policy, but the Congress, under Republican leadership, is enforcing austerity budgets on everything but the military, undermining jobs and growth in the run-up to the 2016 elections.
We are now six years into the recovery, and faring much better than most other advanced industrial countries. But millions of workers are still in need of work. Good jobs remain scarce. Wages stalled before the recession and haven’t picked up. Jobs growth remains modest at best, below rates of previous recoveries.
Officially, the economy is in recovery but working families are not. Congress should be acting to rebuild the country and put people to work. Its failure leaves us with an economy that continues to reward only the few.