Friday, July 2, 2010

Payroll Employment Down 125,000 Due to Census Workers – Private Sector Payrolls Up 83,000

In June, payroll employment fell by 125,000, the first decline since December. In addition, payroll gains over the prior two month were revised downward in aggregate by about 57,000. However, just as the large payroll gain in May was driven by the hiring of temporary Census jobs, June’s decline was suppressed by the termination of 225,000 Census jobs. Private sector payrolls continued to grow over the month, but by only 83,000. Though this is an acceleration from May, where only 33,000 private sector jobs were added, it is still a weak pace and slower than the job gains in March and April. In order to begin to drive down unemployment, payrolls must grow at a pace of at least 150,000 or so per month.

Despite the decrease in payrolls, the unemployment rate, which is measured by a different survey, declined to 9.5 percent from 9.7 percent. The drop was entirely due to a decline in the labor force participation rate, which fell 0.3 percent. The rate had been recovering since last December, but has now declined for two consecutive months, suggesting that more workers are again becoming discouraged. The workforce has fallen by almost a million workers over the past two months.

10.07.02 (Source: Bureau of Labor Statistics)

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