The May employment situation report was released Friday morning. Last month, the unemployment rate ticked higher, hourly and weekly earnings (both nominal and real) for production workers fell, and job gains were less than consensus expectations. However, despite the market’s negative reaction to the news, the report contained a few overlooked positives. The household survey registered a 422,000 increase in employment and the establishment survey showed that both temp worker employment rose and part-time employment (due to economic slack) declined.
Other reports released the same morning were generally more positive. Personal consumption expenditures rose, as did personal income. And the new orders component within the ISM Manufacturing report reached a thirteen month high.
The risk of recession is rising. But for now, we believe data continues point to a growing, albeit slowly, U.S. economy.