Yeah. . .okay. . .that was a really disappointing jobs report that came out Friday morning. The question is, what are we going to do about it?
Expectations, which are typically just a rear-view mirror exercise in this case, were for around 160,000 net new payroll jobs. Instead, we got 38,000, the worst month of job gains since late 2010, the point at which post-recession job growth finally got going. The unemployment rate actually fell sharply in May, from 5 percent to 4.7 percent, but for the wrong reason: not because people got jobs, but because they left the labor force.
The monthly data are noisy, and this month's jobs count took a hit of about 35,000 from the strike against Verizon. But the trend over the past three months amounts to less than 120,000 jobs per month, well below the 200,000/month trend we'd gotten used to.
Still, we don't want to overreact, and while these lousy numbers are consistent with a real growth rate of less than 1 percent in the first quarter of the year, the second quarter is tracking at north of 2 percent. So things could certainly improve.