Manufacturing Jobs Continue 8-Month Slump

In May, 157,000 new jobs were created, according to the employment report, released Friday by the Bureau of Labor Statistics (BLS). Generally, about 150,000 new jobs are needed each month to keep the economy stable, so this was actually good news.

Furthermore, the unemployment rate essentially remained in the 4.5% range, where it has been since last September.

However, when you compare current employment to that of one year ago, there are two disturbing trends.

1. Jobs increased by only 1.5%, which is pretty weak. Even worse, for the last 12 months, year over year job growth has been getting weaker.
2. Of even more concern is that manufacturing jobs have been steadily declining since last October. This means that, in May, there were 1.2% fewer manufacturing jobs than the year before.

Manufacturing jobs are a good leading indicator of overall economic performance, since they produce big-ticket items that consumers will put off buying when the economy starts to weaken. As the orders decline, manufacturers will hire less workers, and even lay off existing workers to keep costs low. (Source: Employment Situation Summary)

What This Means for You

Well, if hiring doesn't start to improve over the next few months, then it is time to prepare for an economic slowdown. The next employment report will be released July 1, so check back then.

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