Photo taken on May 8, 2020 shows closed retail stores in New York, the United States. (Photo by Michael Nagle/Xinhua)
U.S. unemployment rate dropped slightly to 13.3 percent in May, reflecting a limited resumption of economic activity which had been curtailed in March and April due to the COVID-19 pandemic and efforts to contain it.
WASHINGTON, June 5 (Xinhua) -- U.S. employers added 2.5 million jobs in May, and the unemployment rate dropped slightly to 13.3 percent, as businesses gradually reopen across the country, the U.S. Bureau of Labor Statistics reported Friday.
The unemployment rate, though still at a high level, is better than expected. According to a forecast from Wells Fargo Securities Economics Group released Thursday, the unemployment rate could jump further in May to 20 percent.
The unemployment rate previously soared to a record 14.7 percent in April, as COVID-19 continues to ravage the economy. The 10.3-percentage-point jump from March is the highest rate and the largest over-the-month increase since records started being kept in January 1948.
The latest jobs report showed that the unemployment rate declined by 1.4 percentage points to 13.3 percent in May, and the number of unemployed persons fell by 2.1 million to 21.0 million.
"These improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the COVID-19 pandemic and efforts to contain it," the bureau said in the latest jobs report.
"In May, employment rose sharply in leisure and hospitality, construction, education and health services, and retail trade. By contrast, employment in government continued to decline sharply," the bureau noted.
Despite the improvements, the bureau said the unemployment rate and the number of unemployed persons are up by 9.8 percentage points and 15.2 million, respectively, since February.
In May, employment in leisure and hospitality increased by 1.2 million, following losses of 7.5 million in April and 743,000 in March, the report showed. Over the month, employment in food services and drinking places rose by 1.4 million, accounting for about half of the gain in total nonfarm employment.
In contrast, employment in the accommodation industry fell in May by 148,000 and has declined by 1.1 million since February.
Construction employment increased by 464,000 in May, gaining back almost half of April's decline, the report showed. Employment increased by 424,000 in education and health services in May, after a decrease of 2.6 million in April.
Health care employment increased by 312,000 over the month, but job losses continued in nursing and residential care facilities and hospitals, which cut 37,000 and 27,000 jobs respectively.
A pedestrian wearing a mask walks by the U.S. Federal Reserve building in Washington D.C., the United States on May 18, 2020. (Photo by Ting Shen/Xinhua)
In May, employment in retail trade rose by 368,000, after a loss of 2.3 million in April. By contrast, job losses continued in electronics and appliance stores, and in auto parts, accessories, and tire stores, which shed 95,000 and 36,000 jobs respectively.
Manufacturing employment rose by 225,000 in May, while in April, manufacturing employment declined by 1.3 million.
In May, employment continued to decline in government, by 585,000, following a drop of 963,000 in April.
The new report also showed that the labor force participation rate increased by 0.6 percentage point in May to 60.8 percent, following a decrease of 2.5 percentage points in April.
Since late April, many U.S. states have started to reopen their economies, allowing certain nonessential businesses to operate under social distancing guidelines. As of late May, all U.S. states had been in some phase of reopening.
Manufacturing and services industries are also seeing signs of improvement, though at low levels. The Purchasing Managers' Index (PMI) stood at 43.1 percent in May, up 1.6 percentage points from the April reading, indicating a manufacturing contraction for the third straight month, the Institute for Supply Management (ISM) reported earlier this week.
The U.S. services sector, meanwhile, contracted for the second straight month in May despite the gradual reopening, the ISM reported Wednesday. The non-manufacturing index (NMI) registered 45.4 percent, 3.6 percentage points higher than the April reading.
According to a recent projection by the Atlanta Federal Reserve, second-quarter gross domestic product (GDP) will plunge by 52.8 percent at an annualized rate. It anticipates personal consumption expenditures, which make up about two thirds of the nation's GDP, to fall 58.1 percent in the quarter. ■